FBAR: Do You Need to Report Your Foreign Bank Accounts?
If you have authority over foreign accounts exceeding $10,000, the answer is yes. Here's what you need to know.
The FBAR (Report of Foreign Bank and Financial Accounts, FinCEN Form 114) is a reporting requirement for US persons who have financial interest in or signature authority over foreign financial accounts.
Who must file?
Any US person (citizen, resident, or entity) who had a financial interest in or signature authority over foreign financial accounts with an aggregate value exceeding $10,000 at any point during the year.
Wait — how does this affect international founders?
If you're a foreign person (non-US), FBAR generally doesn't apply to you personally. But:
Your US LLC may have an FBAR obligation if the LLC has interest in or authority over foreign bank accounts. For example, if your US LLC has a subsidiary or account in another country.
If you become a US tax resident (through the Substantial Presence Test or Green Card), then your personal foreign accounts become reportable.
What accounts are reportable?
- •Bank accounts (checking, savings)
- •Securities accounts (brokerage)
- •Mutual funds
- •Certain insurance policies with cash value
- •Pension accounts (in some cases)
The $10,000 threshold
The $10,000 is the aggregate maximum value of ALL foreign accounts combined, at any point during the year. If you have:
- •Account A peaked at $6,000
- •Account B peaked at $5,000
- •Combined peak: $11,000 → You must file
Even if the accounts never simultaneously held $10,000.
How to file
FBAR is filed electronically through FinCEN's BSA E-Filing System. It cannot be filed on paper.
Deadline: April 15, with an automatic extension to October 15. No form needed for the extension.
Penalties
FBAR penalties are severe:
- •Non-willful violation: Up to $12,500 per account per year
- •Willful violation: Up to $100,000 or 50% of the account balance, whichever is greater
- •Criminal penalties: Up to $250,000 fine and 5 years imprisonment
FBAR vs FATCA (Form 8938)
These are separate requirements:
- •FBAR → Filed with FinCEN, lower threshold ($10,000)
- •Form 8938 → Filed with IRS (attached to tax return), higher threshold ($50,000-$200,000 depending on filing status and residency)
You may need to file both.
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