On February 26, 2010, the Internal Revenue Service and the Financial Crimes Enforcement Network (FinCEN) of the U.S. Department of the Treasury each issued guidance concerning Report of Foreign Bank and Financial Accounts (FBAR) filings on Form TD F 90-22.1. Generally, U.S. persons or entities having a financial interest in or signatory authority over financial accounts located in foreign countries with an aggregate value greater than $10,000 are required to file an FBAR annually, on or before June 30 of the year following the applicable reporting year (e.g., June 30, 2010, for the 2009 reporting year).
FinCEN's guidance comes in the form of proposed regulations that clarify which persons will be required to file the FBAR and which foreign accounts will in fact be reportable. The proposed rules would also exempt certain persons from the filing requirement and include provisions intended to prevent those who are required to file from avoiding their reporting obligation. The IRS issued its FBAR guidance in the form of Notice 2010-23 and Announcement 2010-16. The latter temporarily suspends the FBAR filing requirement for persons who are not U.S. citizens, U.S. residents or domestic entities, while the former provides FBAR and Form 1040 filing relief for certain persons having a financial interest in or signature authority over a foreign financial account.
The IRS Guidance
IRS Notice 2010-23 modifies and supplements Notice 2009-62 (which provided a filing extension until June 30, 2010, to the below categories of filers), by providing the following:
While Notice 2010-23 gives those persons having only signature authority with respect to a foreign financial account a one-year filing extension, it is important to note that U.S. persons having a financial interest in such foreign accounts, including foreign mutual funds, will be required to file an FBAR (and, if applicable, report the existence and location of the foreign financial accounts on their Form 1040 for the 2009 tax year) no later than June 30, 2010.
In Announcement 2010-16, the IRS suspends the FBAR filing requirement for 2009 and prior calendar years for persons who are not U.S. citizens, U.S. residents or domestic entities, even if those persons were in, and doing business in, the United States. This announcement supplements and supersedes Announcement 2009-51, which allowed persons to rely on the definition of "United States Person" found in the July 2000 version of the FBAR form for 2009 and prior calendar years to determine if they had a filing obligation rather than on the definition in the October 2008 revised version of the FBAR form.
The Proposed FinCEN Rules
The proposed FBAR filing regulations provide guidance on the following issues, among others:
It should be noted that the regulations proposed by FinCEN are not yet effective, and there is no indication therein that they may be relied upon pending issuance of a final rule.
Warren Whitaker will be serving as chair of the 15th Annual International Estate Planning Institute, hosted by the New York State Bar Association and The Society of Trust and Estate Practitioners USA (STEP USA).
On January 23, Susan Ylitalo will be a guest speaker on the topic of "Estate Planning for the Business Owner" before the Estate Planning Council of Lower Fairfield County.
On January 16, Carl Merino and Warren Whitaker participated in "Estate Planning Across Borders: A Guide for the Perplexed," a program at the annual meeting of the New York State Bar Association presented by the Trusts and Estates Law Section.
On January 16, Dina Kapur Sanna will be speaking on a panel, "Lose the Fear of the Foreign – Practical Planning Strategies," at the 53rd Annual Heckerling Institute.
Rebecca Tunney authored a case comment article, "Protecting Real Property from MassHealth's Estate Recovery Claim: Is it Possible?" published by the Massachusetts Law Review.
Day Pitney's Family Office and Trusts and Estates practices have been shortlisted in two categories, "Best Private Client Law Firm" and "Best Trusts and Estates Division," for the 2019 Private Asset Management Awards.
Day Pitney's Family Office and Trusts and Estates practices have been shortlisted in the "Legal Team of the Year" private client category for the 2019 Family Wealth Report Awards.
Darren Wallace was quoted in an article, "Paul Allen's $26 Billion Estate Will Take Years to Unravel," published by Bloomberg.
On October 3, Day Pitney LLP and the Association of Corporate Counsel (ACC), Northeast Chapter – Women's Initiative co-presented a program, "The Power of Women with Wealth," held at Day Pitney's Boston office.
Partner Leigh A. Newman has been selected by the Jewish Federation of Greater Hartford to receive the Jewish Federations of North America's 2019 Kipnis-Wilson/Friedland Award.