FATCA (Foreign Account Tax Compliance Act) obliges banks and other financial institutions in Switzerland to report assets held by American tax payers to the Internal Revenue Service (IRS), which is why if you are a US citizen or green card holder and have an account with a financial institution outside the United States you might need to file a Foreign Bank Account Report (FBAR).
To the point – U.S. citizens and green card holders need to file foreign bank account reports with the US treasury department if they have a financial account outside the US and the aggregate value of all accounts is above $10,000.
A financial account includes bank accounts, brokerage accounts, mutual funds and life insurance accounts with a cash value. Generally, a foreign pension plan, which is administered by an employer, does not have to be reported. However, personal pension plans must be reported.
The penalty for not filing foreign bank accounts is huge and can be significantly worse than tax penalties. Failure to file an FBAR can carry a penalty of $10,000 for each non-wilful violation. However, if your violation is found to be willful, the penalty is the greater of $100,000 or 50 percent of the amount in the account for each violation.
If you feel stuck, you can look to us for diligent and fast preparation of Foreign Bank Account Reports. We make sure to stay caught up on the rapidly changing requirements and can advise you if an account should be reported or not.
You can find more information on our Foreign Bank Account Reporting services on our FBAR page or visit our YouTube channel for US Tax Updates and Tips.
But if you have a more specific question on bank reporting get in touch. Just give us a call +41 52 533 45 81.
You can also find us on Facebook, Twitter, Google+, and LinkedIn.
Article: Swiss banks to tell all under FATCA
Article: US expats feel the burden of FATCA
About US Tax Practice GmbH:
US Tax Practice offers US tax services in Switzerland. It is the go-to tax preparation service and compliance practice for US tax payers. Located in Schaffhausen, Switzerland, the company was founded by Patrick Evans, a US tax accountant (CPA) and US citizen determined to work with his clients’ best interests in mind. US Tax Practice GmbH services include US Income Tax Preparation, US Tax Compliance, Foreign Bank Account Reporting (FBAR), Tax Planning and Optimization, and Expatriation.
We look forward to assisting US expats with the complexities of life in Switzerland. Give us a call!