A one-paragraph definition
The FBAR is the Report of Foreign Bank and Financial Accounts, filed on FinCEN Form 114. It is an annual disclosure in which a United States person lists the foreign financial accounts they hold or control, together with the highest value each account reached during the calendar year. It is filed electronically with the Financial Crimes Enforcement Network — a bureau of the U.S. Department of the Treasury — and it is required whenever the combined maximum value of those accounts exceeded $10,000 at any point in the year.
The short version
A U.S. person with more than $10,000 spread across foreign accounts at any moment in a calendar year reports those accounts to the Treasury by 15 April of the following year, with an automatic extension to 15 October. No tax is calculated on the form. It is pure disclosure.
The law behind the form
The FBAR exists because of the Bank Secrecy Act of 1970. The operative provision is 31 U.S.C. § 5314, which directs the Secretary of the Treasury to require residents and citizens of the United States to keep records and file reports when they deal with a foreign financial agency. That statutory instruction is implemented by regulation at 31 C.F.R. § 1010.350, which sets out who must report, what must be reported and the $10,000 threshold. Related provisions cover the filing mechanics (31 C.F.R. § 1010.306), recordkeeping (§ 1010.420) and penalties (31 U.S.C. § 5321 and § 5322).
Two points follow from that lineage, and both surprise people:
- It is Title 31, not Title 26. The FBAR lives in the banking and financial-crime part of the United States Code, not the Internal Revenue Code. That is why its deadlines, penalties and procedures do not always behave like tax rules.
- Its purpose is law-enforcement transparency. The Bank Secrecy Act was written to give the government a paper trail useful in investigating money laundering, tax evasion and other financial crime. The FBAR is a reporting obligation imposed on the account holder because the foreign institution itself is outside U.S. regulatory reach.
Who administers the FBAR
Three bodies matter, and they do different things:
| Body | Role |
|---|---|
| FinCEN | Owns the form and the regulations. FinCEN issues Form 114 and its instructions, publishes notices and administrative rulings, and operates the BSA E-Filing System through which the report is submitted. |
| Internal Revenue Service | Enforces the FBAR in practice. FinCEN delegated authority to examine compliance and to assess and collect civil FBAR penalties to the IRS in 2003. This is why FBAR questions arise during IRS examinations and why IRS publications discuss the form at length. |
| U.S. Department of Justice | Litigates. It brings suits to collect assessed penalties and prosecutes criminal violations of the Bank Secrecy Act. |
The practical consequence is a split you should keep in mind: you file with FinCEN, but you will most likely be questioned about it by the IRS.
Why it is not a tax form
The FBAR is not attached to Form 1040. It is not mailed to the IRS. It does not go in the same envelope as anything, because there is no envelope — it is submitted electronically through FinCEN’s own system. Filing an extension for your income tax return has no effect on it, and filing the FBAR has no effect on your tax return.
What confuses people is that the tax return asks about it. Schedule B of Form 1040, in the part headed “Foreign Accounts and Trusts”, asks whether you had a financial interest in or signature authority over a foreign financial account and whether you are required to file FinCEN Form 114. Answering that question honestly is a tax matter; actually filing the report is a Bank Secrecy Act matter. The two obligations travel together but are legally distinct.
Consequence worth knowing
Because the FBAR is not a tax form, an income-tax extension to 15 October does not extend it — and conversely, a refund, a nil tax liability or a fully paid return does not excuse a missing FBAR. The two regimes have separate penalties, and the FBAR’s are generally harsher.
What the form actually asks
Form 114 is shorter than its reputation suggests. It has five parts, and most individual filers complete only two or three of them.
| Part | Covers | Who completes it |
|---|---|---|
| Part I | Filer information — name, taxpayer identification number, date of birth, address, and the type of filer | Everyone |
| Part II | Accounts owned separately — maximum value, account number, institution name and address, account type | Most individuals |
| Part III | Accounts owned jointly, plus the co-owner’s details | Joint account holders |
| Part IV | Accounts where you have signature authority but no financial interest | Employees, officers, agents |
| Part V | Consolidated reporting for an entity filing on behalf of subsidiaries it majority-owns | Certain corporate filers |
For each account you report four essentials: the maximum value during the year in U.S. dollars, the account number or other designation, the name and address of the financial institution, and the type of account. There is no income reporting, no expense schedule and no calculation of tax.
The form also asks whether this is an amended report, and provides a field to explain a late filing — a small but important box, discussed on our late and amended filings page.
A short history
Knowing how the FBAR arrived at its present form explains several oddities in the rules.
- 1970. The Bank Secrecy Act creates the reporting authority. For decades the report is filed on paper, on Form TD F 90-22.1, and compliance is patchy and largely unenforced.
- 2003. FinCEN delegates examination and civil penalty authority to the IRS, folding FBAR compliance into ordinary tax examinations.
- 2004. Congress substantially raises the civil penalties and, critically, adds a non-willful penalty — until then, only willful failures were penalised.
- 2010. The HIRE Act introduces FATCA, including Form 8938 and reporting obligations on foreign financial institutions themselves. Foreign banks begin asking customers about U.S. status, and awareness of the FBAR rises sharply.
- 2013. Electronic filing becomes mandatory. Form TD F 90-22.1 is replaced by FinCEN Form 114, filed through the BSA E-Filing System.
- 2016 onwards. The due date moves from 30 June to 15 April to align with the tax filing season, and a six-month automatic extension to 15 October is granted.
- 2023. In Bittner v. United States the Supreme Court holds that the non-willful penalty attaches to each annual report, not to each unreported account — a decision that dramatically reduced exposure for filers with many small accounts. See our penalties page.
Five common misconceptions
“The account is small, so it does not need to be listed”
Once the combined total crosses $10,000, every reportable account goes on the form — including accounts that held $40 all year. The threshold decides whether you file, not which accounts you list.
“I am not a U.S. citizen, so it cannot apply to me”
“United States person” includes resident aliens, which generally means green card holders and anyone who meets the substantial presence test. Many people acquire an FBAR obligation the year they move to the United States, while all their accounts are still at home. See who counts as a U.S. person.
“My foreign bank already reports to the U.S., so the report is duplicative”
It may well be duplicative in substance. It is still legally required. FATCA reporting by institutions does not discharge the account holder’s own Bank Secrecy Act obligation.
“I closed the account, so there is nothing to report”
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.
“Filing late is worse than not filing”
The opposite is generally true. FinCEN’s system accepts late reports and asks for a reason; the IRS has published procedures under which delinquent FBARs are accepted without penalty in defined circumstances. Doing nothing leaves an open, unlimited exposure. See late, delinquent and amended FBARs.
Where to go next
Now that the form itself makes sense, the natural next question is whether it applies to you. Work through the two-part test on the next page, then check the account list and the threshold arithmetic.
- Who must file an FBAR — the definition of a U.S. person, financial interest and signature authority.
- Which accounts are reportable — and which assets are outside the form entirely.
- The $10,000 threshold — aggregation, maximum value and currency conversion.
- Glossary — if a term on this page was unfamiliar.
Reminder. This page summarises statutory and regulatory material in general terms and simplifies in places. It is not tax or legal advice. Before you act, read the current FinCEN Form 114 instructions and consider advice from a qualified professional who knows your facts.