Source: http://oneinjesus.info/2012/01/taxes-for-missionaries-irs-gives-grace-for-failure-to-file-an-fbar/
Timestamp: 2017-01-18 20:07:53
Document Index: 551277974

Matched Legal Cases: ['art 5', 'art 3', 'art 3', 'art 1', 'art 3', 'art 3', 'art 3', 'art 3', 'art 5', 'art 3', 'art 1', 'art 1', 'art 4']

Taxes for Missionaries: IRS Gives Grace for Failure to File an FBAR | One In Jesus
← Rerun: Acts: How Football Changes Everything
The Fork in the Road: “The Way of UNITY between “Christian Churches” and Churches of Christ,” Part 5 →
Taxes for Missionaries: IRS Gives Grace for Failure to File an FBAR
Posted on January 6, 2012 by Jay Guin	A “United States person” is required to file a Report of Foreign Bank and Financial Accounts (“FBAR”) if the citizen has a financial interest in or signature authority or other authority over any financial account in a foreign country, if the aggregate value of these accounts exceeds $10,000 at any time during the calendar year.
“United States person” includes a citizen or resident of the United States, a domestic partnership, a domestic corporation, and a domestic estate or trust. See IRS Announcement 2010-16.
Example 1. A church establishes a $12,000 working fund for a missionary. The money is held in the missionary’s country. The missionary has signature authority on the account. He has to file an FBAR.
Example 2. The chairman of the mission team at the American sponsoring church also has signature authority over the account. He also owes an FBAR.
Example 3. Same as Example 2. The church also owes an FBAR because the church has authority over the account via its missions team chairman, an officer of the church.
Example 4. A missionary is saving for a down payment on a house in a foreign nation. The account balance was $11,000 but the missionary draws $2,000 out to pay for an emergency trip to the U.S. The account is held in a foreign bank. The missionary must file an FBAR because the account was over $10,000 at a point during the year.
Generally, the civil penalty for willfully failing to file an FBAR can be up to the greater of $100,000 or 50% of the total balance of the foreign account at the time of the violation. This penalty is applicable only in cases in which there is willful intent to avoid filing.
Non-willful violations that the IRS determines are not due to reasonable cause are subject to a penalty of up to $10,000 per violation.
There is no penalty in the case of a violation the IRS determines was due to reasonable cause.
Notice that a non-willful violation can become willful if the missionary innocently fails to file and yet continues not to file even after learning about the rule.
A person has signature authority over an account if he can control the disposition of money by delivery of a document containing his signature (or his signature and that of one or more other persons) to the bank or other person with whom the account is maintained.
Filers report their foreign accounts by (1) completing boxes 7a and 7b on Form 1040 Schedule B (for individuals), box 3 on the Form 1041 “Other Information” section (for trusts and estates), box 10 on Form 1065 Schedule B, or boxes 6a and 6b on Form 1120 Schedule N (for corporations) and (2) completing Form TD F 90-22.1 (the “FBAR”).
The FBAR is due by June 30 of the year following the year that the account holder meets the $10,000 threshold. An extension to file Federal income tax returns does not extend the due date for filing an FBAR. Filers cannot request an extension of the FBAR due date. See also IRS Notice 2010-23.
What if I didn’t know I needed to file?
If you learn you were required to file FBARs for earlier years, you should file the delinquent FBARs and attach a statement explaining why they are filed late. You do not need to file FBARs that were due more than six years ago, since the statute of limitations for assessing FBAR penalties is six years from the due date of the FBAR. Keep copies of what you send for your record, .
The IRS has issued detailed guidelines regarding how it will assess penalties. More generally, the IRS says,
I messed up and failed to file. What should I do?
Get the advice of a CPA or tax attorney. File the late FBAR.
(Rom 13:6-7 ESV) 6 For because of this you also pay taxes, for the authorities are ministers of God, attending to this very thing. 7 Pay to all what is owed to them: taxes to whom taxes are owed, revenue to whom revenue is owed, respect to whom respect is owed, honor to whom honor is owed.
Explain why you didn’t file on time, touching on the bases the IRS considers important — money was for missions, not illegal activity. That sort of thing.
FBAR Form with Instructions
IRS Manual, Penalty Guidance on FBARs
My wife’s name is Denise, and I have four sons, Chris, Jonathan, Tyler, and Philip. I have two grandchildren. And I practice law.	View all posts by Jay Guin →	This entry was posted in Taxes, Uncategorized. Bookmark the permalink.	← Rerun: Acts: How Football Changes Everything
3 Responses to Taxes for Missionaries: IRS Gives Grace for Failure to File an FBAR
Todd Collier says:	January 6, 2012 at 7:44 am	Just a friendly reminder to all the ministry types…’tis the season to turn in your “actual” housing allowance figures to the treasurer, secretary or other local “keeper of the records of the purse” and submit your 2012 HA estimates. Don’t make them chase you.
Tim Archer says:	January 6, 2012 at 9:40 am	Trying to remember if I violated this or not while living in Argentina. I think I may have at some point when selling/purchasing real estate. Thankful for the statute of limitations! I wasn’t even aware this existed.
Jay Guin says:	January 6, 2012 at 5:22 pm	Tim,
It’s a very obscure law, poorly publicized even among tax professionals, and awful to violate. One of many severely overreaching laws passed lately in an effort to grab revenues. Again, the Congress shoots flies with bazookas.
Recent CommentsLarry Cheek on N. T. Wright’s The Day the Revolution Began, Romans Reconsidered, Part 3 (Sin enters the world; Works salvation? )Dwight on The Gospel Advocate Creed: The March 2016 IssueDwight on N. T. Wright’s The Day the Revolution Began, Romans Reconsidered, Part 3 (Sin enters the world; Works salvation? )Matt on The Gospel Advocate Creed: The March 2016 Issuestacy0063 on N. T. Wright’s The Day the Revolution Began, Romans Reconsidered, Part 1 (the righteousness of God)Ben on Should I Change Congregations? I Get EmailsDwight on Should I Change Congregations? I Get EmailsLarry Cheek on N. T. Wright’s The Day the Revolution Began, Romans Reconsidered, Part 3 (Sin enters the world; Works salvation? )Alabama John on Should I Change Congregations? I Get EmailsSkip Freeman on Hallelujah, performed with new lyrics by ClovertonJay Guin on Should I Change Congregations? I Get EmailsKathy on Should I Change Congregations? I Get EmailsDwight on N. T. Wright’s The Day the Revolution Began, Romans Reconsidered, Part 3 (Sin enters the world; Works salvation? )Kaylee Rodgers: Hallelujah | davidbruceblog on Hallelujah, performed with new lyrics by ClovertonLarry Cheek on N. T. Wright’s The Day the Revolution Began, Romans Reconsidered, Part 3 (Sin enters the world; Works salvation? )Larry Cheek on N. T. Wright’s The Day the Revolution Began, Romans Reconsidered, Part 3 (Sin enters the world; Works salvation? )Alabama John on Born of WaterDwight on Born of WaterDaniel Keeran on Born of WaterBonneeBee on Born of WaterDaniel Keeran on Born of WaterBonneebee on Born of WaterBonneeBee on Born of WaterBonneeBee on Born of WaterDaniel Keeran on Born of WaterTop Posts & Pages	Hallelujah, performed with new lyrics by Cloverton	Should I Change Congregations? I Get Emails	Ray Vander Laan's "Follow the Rabbi" lectures	N. T. Wright's The Day the Revolution Began, Romans Reconsidered, Part 5 (the Salvation of the Jews pre-Pentecost)	N. T. Wright's The Day the Revolution Began, Romans Reconsidered, Part 3 (Sin enters the world; Works salvation? )	Acts 2: Were the Apostles Baptized in Water? Part 1	N. T. Wright's The Day the Revolution Began, Romans Reconsidered, Part 1 (the righteousness of God)	N. T. Wright's The Day the Revolution Began, Romans Reconsidered, Part 4 (the Salvation of those in Jesus)	Inerrancy: An Essay	To Change the World: Essay 1, Summary	Wineskins Magazine