9d • General discussion
IMPORTANT TAX DEADLINES
As tax season winds up, there are three dates that are of importance to taxpayers, whether you are inside or outside of the U. S.
APRIL 15 – PAYMENT DEADLINE
For taxpayers here in the U. S., the IRS expects payment of taxes by April 15 this year. This is whether you are filing yet or not. Interest starts kicking in from April 15 for unpaid taxes.
Common misconception: Filing an extension means you can pay later. But that’s not what it means. An extension only allows more time to file, not to pay. You may file an extension to submit your tax return, but you must pay estimated or expect taxes with IRS Form 4868, Application for Automatic Extension of Time To File U.S. Individual Income Tax Return.
JUNE 15 – FILING DEADLINE FOR AMERICANS ABROAD
If you live outside the U. S., you receive an automatic 2-month extension to file, without even requesting the extension. This is part of the tax code that automatically applies to Americans living overseas.
What you may not realize: This automatic extension only extends the date to file the tax return, not the deadline to pay. You will also accrue interest from April 15 if you wait until June 15 to pay.
OCTOBER 15 – EXTENDED DEADLINE
If you need more time to file your return, file IRS Form 4868, Application for Automatic Extension of Time To File U.S. Individual Income Tax Return. This deadline is most often used by Americans abroad who utilize the FEIE (Foreign Earned Income Exclusion), have more complicated situations, or need more time to compile foreign documentation.
FBAR – FOREIGN BANK AND FINANCIAL ACCOUNT REPORT
If you have money in foreign bank accounts, you have a requirement to report any and all bank accounts with an aggregate value of greater than $10,000 at any time during the year. The FBAR is an information return that is separate from your tax return.
Example. You have three foreign bank accounts with the following balances:
Bank Account #1: Balance, $200
Bank Account #2: Balance, $1,587
Bank Account #3: Balance, $8,214
Because these three bank accounts have an aggregate value of $10,001, all three bank accounts must be reported.
The FBAR is a mandatory filing requirement under the Bank Secrecy Act (BSA) for U.S. persons and is mandated by FinCEN (Financial Crimes Enforcement Network). This requirement applies to U.S. persons, including individuals, businesses, trusts, and estates. This report enhances financial transparency and helps combat financial crimes, such as tax evasion and money laundering. Penalties of up to $10,000 per non-willful violations can be imposed, with severe fines or imprisonment for willful violations.
In summary, the IRS allows flexibility in filing, but failure to file or pay timely, will cost you!
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IMPORTANT TAX DEADLINES
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