foreign bank reporting and FBAR

[Catherine]

Client is a US citizen. Her family moved to New Zealand when she was a teenager. In 2021 she and her NZ-born husband moved back to the US with their family.

She has never filed an FBAR - never knew about the requirement; after all she was just a kid when they left the US. Now they are faced with having to file FBAR forms going back umpty years.

Anyone know how many years back she has to file? The standard six, or is it more?  I can't find that information on either the IRS or FinCen FBAR filing sites.

Oh - and her NZ-citizen husband only has to file for the time since he got a US social security number, correct? (Which means he, at least, will be current when he files for 2022.)

[Gail in Virginia]

  She may have used banks that are located in both NZ and USA, and that had accounts that treated her as a US account holder that would not require reporting?  Maybe she never had $10,000 in her name on one day while they were living in NZ, at least not in NZ accounts.  I would look to see if there is currently any kind of amnesty program also. 

[Catherine]

The IRS site just says file all past due returns at FinCen and make sure you paid US tax on earnings. Most likely she had no US filing requirement for most of the years in question (a kid in school, some work, then stay at home mom). 

Would she have had to file a US return with no income just to check the box for foreign accounts even if no FBAR was needed due to low balances?

[Yardley CPA]

3 hours ago, Gail in Virginia said:

  She may have used banks that are located in both NZ and USA, and that had accounts that treated her as a US account holder that would not require reporting?  Maybe she never had $10,000 in her name on one day while they were living in NZ, at least not in NZ accounts.  I would look to see if there is currently any kind of amnesty program also. 

As Gail stated, were you able to confirm if she had foreign financial accounts exceeding $10,000?  If she didn't, I wouldn't bother with filing...but that's just me and I readily admit my experience with FinCEN FBAR is limited at best.  

[Sara EA]

There are no current amnesty programs that I know of.  I had a client who requested amnesty when it existed, and IRS requested six years of returns.  They did look at them and asked me lots of follow-up questions, so be careful.  Well, they asked the attorney, who asked me.  It was the one time in my career I was a Kovel accountant.