FBAR ISSUE - Idea Center is temporarily closed - this should go to ProSeries support/developers
ProSeries Support /Developer Team,
While reviewing a client’s 2024 tax return, we identified what appears to be a systemic issue in the software’s annual file-transfer process.
When the client’s file was transferred from the prior year, the federal and state e-filing elections on the Federal Information Worksheet carried over as expected. However, the election to electronically file the client’s Report of Foreign Bank and Financial Accounts (FBAR), FinCEN Form 114, did not carry forward.
The FBAR had been completed, and Schedule B, Part III, line 7a was marked “Yes,” indicating a FinCEN Form 114 filing requirement. Nevertheless, because the FBAR e-filing election was not carried over, the client’s 2024 FBAR was not timely submitted.
We believe this software behavior creates a significant risk that preparers may inadvertently fail to file an FBAR for a client with an ongoing filing requirement. The presence of a completed FBAR within the program may reasonably lead a preparer to believe that it is included with the returns scheduled for electronic filing.
We respectfully suggest implementing one or both of the following safeguards:
- Carry over the FBAR e-filing election during the annual file-transfer process, consistent with the treatment of federal and state e-filing elections.
- Generate a filing error or prominent diagnostic when an FBAR has been completed but has not been selected for electronic filing or transmitted, particularly when Schedule B indicates a Form 114 filing requirement. Ideally, the warning would prevent finalization of the return or require the preparer to acknowledge that the FBAR remains unfiled.
These safeguards would materially reduce the risk of an inadvertent failure to submit an FBAR, particularly when the form has been completed, and the relevant foreign financial accounts have been entered in accordance with applicable federal reporting requirements.
Please investigate whether this behavior affects other users and advise whether you plan a correction or software enhancement. We would also appreciate guidance regarding any interim procedures preparers should follow to ensure that completed FBARs are included in the electronic-filing workflow.
