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Are you an American with a foreign bank account?
You really need to know what an FBAR is.
The Foreign Bank Account Report, known as an FBAR, is a required US Treasury form on which American citizens annually provide information about their foreign financial accounts – institutions, accounts, and amounts.
FBARs are not about income, but about accounts, where they are, and how much is in them.
A routine yearly government request for such detailed financial information would be objectionable to most Americans. Objections are rare because Americans living in the US don’t know about the FBAR. Few of them have foreign accounts, so the FBAR is irrelevant.
It’s a different story for Americans living abroad. They need and have foreign accounts.
The Treasury Department requires FBAR information because they believe that foreign accounts are frequently used for criminal purposes by money launderers, drug traffickers, oligarchs, and other criminals.
Such concerns don’t apply to most Americans living abroad who need a foreign bank account to pay for groceries and the rent. Moreover, what’s foreign to the US government is local to the expat.
Nevertheless, the FBAR dragnet applies to the law-abiding middle class expat who isn’t laundering, trafficking, oligarching, or criming.
The penalties of FBAR non-compliance are scary-bad but rarely applied. You need to know what your choices are.
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