Sunday, May 5, 2013


Most expats in Mexico understand that under US FATCA law the banks in Mexico will be reporting the the foreign bank accounts held by US taxpayers and green card holders to the IRS.  Many have felt that their accounts with INTERCAM, MONEX and other non bank financial institutions in Mexico are safe from IRS scrutiny. Suddenly,  that is no longer the case.

The IRS has started to issue John Doe Court Subpoena's to US Banks that act as clearing houses (or correspondence banks) for foreign financial companies including stock brokers, money exchange companies, etc ordering them. to provide the IRS with records that will identify US taxpayers with
foreign financial accounts.

The IRS will then match the documents received pursuant to the subpoena with those who have filed FBAR forms (TDF 90-22.1) and for those who have not reported those foreign financial accounts will impose penalties of $10,000 or more and possibly seek criminal prosecution.  Recently the IRS convicted an 89 year old lady for not reporting her foreign bank accounts.

It does not appear the IRS has yet  started this procedure on Mexican accounts but no doubt they will begin soon. Therefore there is still time to file your FBAR forms for current and past years under the existing Offshore Disclosure Program or other methods that are available to avoid or reduce penalties.

We have helped well over a hundred expats living in Mexico catch up and successfully avoid or reduce penalties. We can also help you.  Visit our website at  for more information and for help.

Remember your 2012 FBAR form must be received by the IRS prior to 6/30/13.  It cannot be extended.  In many situations you may have to also report those accounts on Form 8938 filed with your personal tax return also.