U.S. persons with an interest in or authority over "foreign financial accounts" are required to make an annual filing with the Internal Revenue Service (IRS) on Treasury Form TD F 90-22.1 (Report of Foreign Bank and Financial Accounts (FBAR)) by June 30 of the year following the year in which the U.S. person maintained the interest or authority. Principals of investment managers of offshore hedge funds commonly are required to file the FBAR because they act as directors of the offshore funds their firms manage (which creates the filing obligation). Recent informal comments by IRS staff members, however, indicate that the IRS may consider an interest in a hedge fund organized under the jurisdiction of a country other than the United States a foreign financial account subject to the FBAR filing requirement.

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Source: Hedge Fund Alert
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