If you have an interest in an offshore bank account or another type of foreign financial account, you may be required to file a yearly report for the account with the Department of Treasury. The penalties for not filing Form FinCEN 114 are costly, and if you have been putting off disclosing your foreign bank accounts to the IRS, you should be aware of the risks you face by continuing to hide your offshore accounts.
There can be both criminal and civil penalties for failing to satisfy your Foreign Bank Account Reporting (FBAR) requirements. Criminal penalties can include up to 5 years in prison and a $250,000 fine. The willful failure to file FBAR is also a felony that can result in the loss of your right to vote, revocation of professional licenses for attorneys, doctors, and other professionals, and deportation of green card holders.