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Foreign Bank Account Reports (FBARs) and Overlapping FATCA Disclosure Requirements: New Rules, Forms and Official Guidance


Product Code - TMA28
Speaker(s): Charles M. Bruce , Moore & Bruce, LLP (Partner) and Bonnard Lawson (Counsel), and Stanley C. Ruchelman, The Ruchelman Law Firm (Member)
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U.S. citizens, residents and certain defined entities that have a financial interest in or signature power over foreign financial accounts must file an FBAR if the aggregate value of the accounts exceeds $10,000 at any time during the calendar year. The filing deadline is June 30th for the prior calendar year (not subject to extension). Treasury Department (FinCEN) published new final FBAR regulations on Feb. 24, 2011. The IRS published a new FBAR (Form TD F 90-22.1 (Rev. Mar. 2011)) on Mar. 26. On Mar. 30, the IRS published Notice 2011-31 providing detailed instructions for answering questions relating to filing FBARs. Apart from FBAR filings, but overlapping in important ways, are new FATCA foreign financial assets disclosure rules (new section 6038D of the Internal Revenue Code, effective March 18, 2010 and applicable to 2010 Form 1040 filings). IRS forms and/or sample statements have not been published.

Presentation Objectives:

The objectives of this 60-90 minute audio discussion include providing participants with an understanding and practical application of the following:

I. FBAR Disclosure

* Overview—What is FBAR? What are its underpinnings? Who administers it? Who enforces it? What is the information used for? What are the surrounding "realities"?
* TD F 90-22.1 (New Foreign Bank Account Report; Mar. 2011). Strolling through the new final regulations. Who must file? U.S. person? Reportable accounts (not just bank and brokerage accounts)? What is a financial interest (not just owner of record or title holder; indirect ownership; trusts and estates)? Signature power or other authority? Special rules for publicly-traded companies? Spouses, co-signatories, marital property? Problem areas.
* How to deal with delinquent and amended FBARs. Voluntary Disclosure Programs--insights.
* Penalties — Hold on to your hat.
* What’s changed and what’s noteworthy? Disregarded entities. Individuals doing business in US but not an NRA. Short-duration accounts. Accounts in connection with transaction closings. Mutual funds. Insurance policies. Private hedge fund accounts. Accounts owned by grantor trust. Accounts owned by nongrantor trusts—situation for beneficiary. Implications if there is a trust protector.
* Treatment of beneficiaries of wholly discretionary trust. Treatment of different fact situations involving ownership of gold—physical gold (bullion) and other forms.

II. FATCA Disclosure

1. New section 6038D (Information with respect to foreign financial assets). Introduction. How does this differ from FBAR reporting?
2. Status of IRS guidance.
3. How to comply.
4. Problem areas.

Upon completion of this program, participants will have the tools to:

1. Determine applicability of FBAR filing requirements.
2. Advise how to complete FBAR form.
3. Recognize problem areas.
4. Determine applicability of new section 6038D FATCA disclosure rules.

Charles M. Bruce , Moore & Bruce, LLP (Partner) and Bonnard Lawson (Counsel), and Stanley C. Ruchelman, The Ruchelman Law Firm (Member)

Charles M. Bruce is partner in Moore & Bruce, LLP (Washington, DC) and Counsel in Bonnard Lawson (Lausanne Office). He specializes in international tax, corporate transactions and financings. He is known for his work in the private client areas of trusts and estates and tax compliance. Formerly Tax Counsel, US Senate Committee on Finance; Adjunct Professor of Law, Graduate Law Program, Georgetown University Law Center; Visiting Professor, Institut für Ausländisches und Internationales Finanz- und Steuerwesen (International Tax Institute), Hamburg University. Member of the American Bar Association, International Bar Association, International Fiscal Association (US and UK Branches), the Society of Trust and Estate Practitioners, and the International Tax Planning Association. Mr. Bruce sits on the Board of Directors of a number of corporations and charitable foundations. He is General Counsel of a privately held investment company. He divides his time between Washington, DC and London.

Stanley C. Ruchelmanis a member of The Ruchelman Law Firm. His practice concentrates on tax planning for cross border transactions. He has authored numerous monographs on international taxation for a variety of publications and treatises. In addition, Mr. Ruchelman is a frequent lecturer on this subject, having spoken at the Practicing Law Institute, New York University Tax Institute, the American Bar Association, the International Fiscal Association, and other organizations. He is active in the American Bar Association Section of Taxation. He served as Chair of the Committee on US Activities of Foreign Taxpayers and Treaties and was the USA reporter for the Foreign Lawyers Forum. Mr. Ruchelman served on the National Council of the International Fiscal Association -- USA Branch. He received his J.D. Degree with honors from The George Washington University Law School (1972) and his undergraduate degree from Brooklyn College (1968).