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The FBAR Filing Requirements and Retirement Systems (August 7, 2009) 

The FBAR is an annual report filed with the IRS that applies to U.S. citizens, including domestic entities, with an interest in a foreign financial account. Many retirement systems have foreign investments and these foreign investments had not been considered foreign accounts for purposes of the FBAR, as long as the retirement system maintained a minority interest in the foreign investment fund. The FBAR instructions for 2008 were amended to expand the definition of foreign accounts more broadly to include any interest in a commingled fund, including mutual funds. If the IRS followed a broad reading of the requirements, retirement system employees and officers who have signature authority over the investment of retirement plan assets in foreign investments have been concerned that they may have an obligation to file an FBAR. 

Postponement of Filing Requirements Until June 30, 2010 

Today the IRS issued Notice 2009-62 (copy attached), which will appear in the Internal Revenue Bulletin dated August 31, 2009. This Notice provides an extension of the filing date for the FBAR (Report of Foreign Bank and Financial Accounts, Form TD F 90-22.1) in certain cases for 2008 and earlier years until June 30, 2010. 

This Notice provides temporary administrative relief that would apply to individuals who are responsible for retirement system investments where (1) the person has no financial interest in a foreign financial account but has signature or other authority over the foreign financial account, or (ii) the person has a financial interest in, or signature or other authority over, a foreign financial account in which assets are held in a commingled fund. Under Notice 2009-62, officers and employees with investment authority over retirement system assets would not be required to file an FBAR for all prior years until June 30, 2010. This extension will give the Treasury Department more time to assess whether an exception to the FBAR filing obligations may be appropriate for certain situations. 

Public Comments Requested By October 6, 2009 

The Department of the Treasury also expressed an interest in receiving public comments on FBAR issues addressed in the Notice, including possible relief from the filing requirements for investments in a foreign commingled fund. Any comments should be filed by October 6, 2009. 

If you have any questions, or would like additional information, please contact Judy Boyette at jboyette@hansonbridgett.com or 415-995-5115. 

IRS Notice Regarding FBAR Filing Extension Read more »

Hanson Bridgett is a law firm with more than 150 attorneys in offices in San Francisco, Sacramento, the North Bay, Silicon Valley and the East Bay. Serving clients since 1958, we are well known in Northern California and have earned a national reputation in many of our practice areas.

Our diverse client list includes large national and global companies as well as many governmental entities, regional businesses and individuals. While we keep true to our California roots, our work increasingly takes us across state and national borders.

Michelle Klopp
Hanson Bridgett LLP
425 Market Street, 26th Floor
San Francisco, CA 94105

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