Many investors have made small fortunes in the virtual currency, aka cryptocurrency, markets. As this type of investment has become more popular, investors are now having to deal with tax compliance aspects of investing in cryptocurrency.
And one of the questions I’m getting a lot lately is if Cryptocurrency is Reportable on an FBAR as a foreign account that holds value.
A Foreign Bank Account Report (FBAR), is required to be filed when the aggregate value of all offshore accounts exceeds $10,000 at any point during the tax year.
Currently, the Report of Foreign Bank and Financial Accounts (FBAR) regulations do not define a foreign account holding virtual currency as a type of reportable account.
For that reason, at this time, a foreign account holding virtual currency is not reportable on the FBAR (unless it is a reportable account under 31 C.F.R. 1010.350 because it holds reportable assets besides virtual currency).
However, be aware that this will most likely soon change. It has already been published that the Department of the Treasury intends to propose to amend regulations implementing the Bank Secrecy Act (BSA) regarding reports of foreign financial accounts (FBAR) to include virtual currency as a type of reportable account.
If you have more questions, or need further guidance, let’s discuss. I'm always happy to provide detailed and personalized guidance through a 1:1 consultation. You may book the best day and time for you to meet by contacting me to schedule your consultation.