Foreign Bank Account Report (FBAR) Filing Date Extended by HR 3236‏

Today, July 31, 2015, President Barack Obama signed into a law HR 3236 a highway funding bill. Buried in the Bill is a provision which changes the filing date for Foreign Bank Account Reports (FBARs) to April 15th.  Up until now the due date for the FBAR, which must be filed electronically on FinCEN Form 114 (formerly TD F 90-22.1) was June 30th. The Bill also provides for an extension of time of up to 6 months to file the FBAR, making the extended due date October 15th.  This reconciles the due date for the FBAR with the individual tax return filing date. Before now many taxpayers were tripped up by the differences in the filing dates. Because many taxpayers go on extension for their tax returns, and don't have extensive discussions with their CPAs, or other tax preparers until shortly before the extended deadline of October 15th, there were many instances of individuals not realizing they had a filing responsibility until after the June 30th deadline. Those taxpayers were usually stunned to find out that the extension of the filing date for their tax return did not extend the time to file their FBARs.  This was a common sense fix to an unnecessary problem.

The Bill also authorizes a first time abate (FTA) procedure of sorts. Specifically the Bill states: "[f]or any taxpayer required to file such [FBAR] Form for the first time any penalty for failure to timely request for, or file, an extension may be waived by the Secretary."  This appears to provide authority to abate an FBAR penalty if the FBAR is filed after April 15th, but before October 15th, if this is the first time the FBAR was due. The language doesn't really add anything to the law since the IRS already has wide latitude to waive FBAR filing penalties. These provisions become effective next year so the FBAR filing due date for 2015 will be April 15, 2016.
Finally, the Bill overturns the Supreme Court's decision in Home Concrete (Home Concrete & Supply LLC, 132 S. Ct. 1836 (2012)). That case dealt with the 6 year statute of limitations under Internal Revenue Code Section 6501(e)1)(1)(A) which provides for the longer statute of limitations where there is an omission from gross income in excess of 25%. The Supreme Court held that this rule did not apply in the case of basis overstatements. The Bill specifically amends Code Section 6501(e)(1) to provide that an omission from gross income includes an overstatement of basis. This is part of a disturbing trend by Congress to continue to increase time the IRS has to assess additional taxes.