Frequently Asked Questions
Short answers to the questions we are asked most often, each linked to the fuller explanation.
The questions we are asked most often, with links to the fuller explanations. Every answer here is general information, not advice about your situation — see our disclaimer.
- Basics
- Thresholds and values
- Deadlines and filing
- Who files
- Accounts and assets
- Problems and corrections
Basics
What is the FBAR?
The FBAR is the Report of Foreign Bank and Financial Accounts, filed on FinCEN Form 114. A United States person files it annually with the Treasury Department to disclose foreign financial accounts, when their combined maximum value exceeded $10,000 at any time during the calendar year. No tax is calculated on it — it is pure disclosure.
Is the FBAR filed with my tax return?
No. It is filed separately and electronically with FinCEN through the BSA E-Filing System. It is not attached to Form 1040 and is not sent to the IRS — although Schedule B does ask whether you are required to file it, and answering that question incorrectly creates its own problems.
Do I have to file if I owe no tax?
Yes. The FBAR is an information report under the Bank Secrecy Act. It is due whether or not the accounts earned anything and whether or not you owe a cent of tax. A nil liability is not a defence to a missing report.
How much does it cost to file?
Nothing. Filing on FinCEN’s BSA E-Filing System is free, and individuals do not even need to register an account. Commercial services may legitimately prepare and submit the form for a fee, but no payment to anyone is required in order to file with the government. Be wary of any site that suggests otherwise.
Thresholds and values
Does the $10,000 threshold apply to each account?
No — it is the combined maximum value of all your foreign financial accounts. Five accounts peaking at $2,100 each aggregate to $10,500 and trigger a filing requirement. And once you file, every reportable account goes on the form, including the one that held $30 all year.
Do I use the year-end balance or the highest balance?
The highest value the account reached at any point during the calendar year. Then convert that figure to U.S. dollars using the Treasury Reporting Rate of Exchange for the last day of the year being reported — one date for the balance, a different fixed date for the rate.
What if my total is exactly $10,000?
The requirement is triggered by an aggregate exceeding $10,000, so precisely $10,000 is below the line. Given rounding and exchange-rate uncertainty, though, a result that close to the threshold is a poor place to rely on a technicality — filing costs nothing and carries no penalty.
Do I need to report an account I closed during the year?
Yes. An account that existed at any point during the calendar year is reportable for that year at its maximum value, even if it was closed in February. Download the final statement before the bank closes your online access — closed accounts are the hardest thing to document later.
Deadlines and filing
When is the FBAR due?
15 April of the year following the calendar year reported, with an automatic extension to 15 October that every filer receives without requesting it. No form, no letter, no reason required.
Does my income tax extension cover the FBAR?
No, and it does not need to. The FBAR extension is automatic and entirely independent of your tax return. Equally, extending your 1040 does nothing for the FBAR — the two regimes run in parallel.
How do I actually file it?
Online, through FinCEN’s BSA E-Filing System, choosing the individual filing option. You complete the five-part form, sign it electronically and receive a confirmation email with a submission identifier. Save that email and a PDF of the form.
How long do I have to keep the records?
Five years from the report’s due date, covering the account name, number, institution details, account type and maximum value. Because the government generally has six years to assess a civil penalty, keeping everything for seven years is the simpler habit.
Who files
Can my spouse and I file one FBAR?
Only if all of the following hold: every account the non-filing spouse would report is jointly owned with the filing spouse; the report is filed on time and signed electronically; and both spouses sign Form 114a. One separately held account in either spouse’s sole name and you are back to two reports.
How do I report a joint account?
At its full maximum value, not your share. Each U.S. co-owner reports the whole account on their own FBAR and names the other co-owners. The same money legitimately appears on two reports — that is the intended result.
Do I report an account I can sign on but do not own?
Generally yes — in Part IV, and at full value for threshold purposes. Narrow exceptions exist for certain officers and employees of banks, regulated financial institutions and large or publicly traded employers, but they rarely help someone signing on a small private company’s account.
Do children have to file?
Yes — there is no minimum age. A child who is a U.S. person and meets the test files in their own name, and a parent or guardian signs where the child cannot. Accounts opened for a child by a relative abroad are among the most commonly overlooked.
Does my single-member LLC file its own FBAR?
Yes. An entity organised in the United States is a U.S. person for FBAR purposes even if it is disregarded for income tax, and it files its own report if the threshold is met. You may also have a reportable financial interest in the same accounts personally.
Accounts and assets
Does filing Form 8938 satisfy the FBAR requirement?
No. Form 8938 is an IRS form filed under FATCA with your tax return; the FBAR is a FinCEN form filed under the Bank Secrecy Act. Different agencies, thresholds, asset lists and penalties. Where both apply, both must be filed in full.
Is cryptocurrency at a foreign exchange reportable?
FinCEN stated at the end of 2020 that it intended to propose amending the regulations to include virtual currency as a reportable account type. Until such an amendment is finalised, an account holding only virtual currency has generally not been treated as reportable — while one also holding fiat balances or securities is reportable in the ordinary way.
This is the answer on this site most likely to be out of date. Check the current Form 114 instructions and FinCEN notices directly. Many advisers report these accounts voluntarily, on the basis that reporting an account that turns out not to have been required carries no penalty.
Is my foreign property reportable?
Not if you own it directly — real estate is not a financial account, and it is not reportable on Form 8938 either when held directly. But a foreign account holding the rental income or sale proceeds is reportable in the ordinary way, and property held through a foreign entity changes the analysis.
Is my foreign pension reportable?
It depends on the structure, and there is no blanket answer. An individual account in your own name with an identifiable balance generally looks like a reportable financial account. A state social-insurance entitlement generally is not an account at all. Employer defined-benefit schemes fall somewhere between and may raise Form 8938 questions instead.
My account is with a U.S. bank’s branch in London. Is that foreign?
Yes. The test is where the account is maintained, not who owns the bank. A U.S. bank’s London branch holds a foreign account; a foreign bank’s New York branch does not.
Problems and corrections
What happens if I have never filed an FBAR?
There are established routes back. If you reported and paid tax on all the income from the accounts, the IRS delinquent FBAR submission procedures may let you file the missing reports without penalty. If income was also unreported, the Streamlined Filing Compliance Procedures may apply for non-willful conduct, and voluntary disclosure where willfulness is arguable.
Two rules of thumb: coming forward before the IRS contacts you preserves nearly all of your options, and if willfulness could genuinely be in question, speak to a tax attorney before filing anything.
How do I correct a mistake on a filed FBAR?
File an amended FBAR referencing the original submission’s identifier, completed in full rather than showing only the changes, and fix every affected year. Do not file a second original for the same year — that creates duplicate records.
How bad are the penalties, really?
It depends entirely on willfulness. A non-willful violation carries a maximum of $10,000 as adjusted for inflation, per annual report since the Supreme Court’s decision in Bittner, and is subject to a reasonable cause defence — and in many first-time cases the IRS has issued a warning letter instead. A willful violation carries the greater of $100,000 as adjusted or 50 per cent of the account balance, per account, per year.
My foreign bank already reports to the U.S. Isn’t the FBAR redundant?
In substance, often yes. Legally, no. FATCA reporting by a financial institution is a separate obligation imposed on the institution; it does not discharge your own Bank Secrecy Act duty to file. If anything, institutional reporting makes an unfiled FBAR easier for the government to notice.
Question not answered here?
We cannot advise on individual circumstances, but we do use reader questions to decide what to cover next. Tell us what is missing and we will consider it for a future update.
Reminder. These answers are short by design and omit exceptions covered on the linked pages. They are general educational information published by St Fin Corp, not tax or legal advice, and no professional relationship arises from reading them. Rules change — verify against the official sources and consult a qualified adviser about your own facts.