Practice Alert: BE-10s for Owners of Foreign Entities
Update: You may be able to obtain an extension. For details, see "Practice Alert Update: BE-10s for Owners of Foreign Entities."
June 30, 2015, is the due date for the first mandatory filing that is required of every US Person who owned a 10% or more interest in a foreign entity at any time during 2014 (Form BE-10, Benchmark Survey of U.S. Direct Investment Abroad). Failure to file carries penalties of $2,500 - $25,000 plus imprisonment. Many are unaware of this deadline, and do not expect it would apply to them.
BE-10 is required of every US Person that directly or indirectly owns 10% or more of a foreign entity, including flow-throughs. "US Persons" includes individuals, entities, partnerships, trusts and estates. The filing requirement applies even though all the information is already on file with IRS in various tax reports. The Department of Commerce wants it on its own form.
Non-mandatory benchmarking surveys, including BE-11 tracking foreign investment in the US, have been part of the landscape for years. Similar filings were required of a much smaller class in the past, but the underlying Department of Commerce Regulation was quietly amended in November 2014 to cover this broad class. Until now there has not been much publicity. Accounting firm return preparers should have most of the financial information available. If this may apply to you, first check with your return preparer, and feel free to contact Gary M. Harden on questions, or for support. Time is short.