Did You Report Your Foreign Bank Accounts?

Posted By Pedro Gonzalez, CPA on Jan 11, 2021 |


If you own or have an interest in any foreign bank account or other types of financial accounts (see below for examples of the other types) that are based outside of the United States, you may have to fill out the Report of Foreign Bank and Financial Accounts (FinCEN Form 114 or “FBAR”) every year.

Reporting Foreign Bank Accounts

You must report accounts you hold in foreign banks and other financial institutions if the total balance across all your accounts is $10,000 or more at any time during the calendar year. Reporting includes accounts of which you’re the owner, as well as accounts for which you have authority to conduct transactions on behalf of the account owner.1

Report each foreign financial account you own or on which you have signature authority using FinCEN Form 114. You’ll provide information on all your financial accounts held in foreign countries, such as the name of the bank or financial institution where the account is held, your account number, and the account balance.

The Foreign Bank Account Report is filed for each accountholder. Married couples can file separate reports or a single joint report.

Types of Reportable Accounts

The following types of financial accounts must be reported on the Foreign Bank Account Report if you meet the filing requirement threshold:

  • Bank accounts (checking and savings)
  • Investment accounts
  • Mutual funds
  • Retirement and pension accounts
  • Securities and other brokerage accounts
  • Debit card and prepaid credit card accounts
  • Life insurance and annuities having cash value

Income Thresholds for Reporting

There are separate thresholds for being required to disclose foreign accounts. The threshold starts at total foreign account balances of $50,000 on the last day of the year, or $75,000 at any time during the year for Form 8938 purposes. There are higher reporting thresholds for married couples filing jointly and for Americans living abroad.2

Statute of Limitations for Reporting

There’s a six-year statute of limitations for the assessment of civil penalties for failing to report. The IRS advises that taxpayers should keep their foreign bank account report for six years.3

Penalties for Not Reporting

The Treasury Department can impose very stiff penalties for failing to file FinCEN Form 114:

  • The penalty is up to $250,000 and/or up to five years in prison for failure to file or to keep records.
  • The penalty is up to $500,000 and/or up to 10 years in prison for any person willfully who violates the requirements to file.
  • The penalty for giving false information is a fine of $10,000, up to five years in prison, or both.4

When to File FinCEN Form 114

The FBAR is an annual report, due April 15 following the calendar year reported. You’re allowed an automatic extension to October 15 if you fail to meet the FBAR annual due date of April 15. You don’t need to request an extension to file the FBAR. 1

How to File FinCEN Form 114

You must file the FBAR electronically through the Financial Crimes Enforcement Network’s BSA E-Filing System. You don’t file the FBAR with your federal tax return. .

You can call the FinCEN Regulatory Helpline at 800-949-2732 (toll-free inside the United States) if you need an alternative to electronic filing. Call 703-905-3975 from outside the U.S. This line is not toll-free.

Exceptions to Filing

You don’t have to report accounts held at U.S. military banking facilities, even if they’re located in foreign countries. Military banks are considered to be domestic U.S. banks.

You also don’t have to report U.S.-based accounts held by a branch or division of a foreign bank.

Where to Get Technical Help

Americans can receive help with their foreign bank account reports by calling the IRS at 866-270-0733 (toll-free inside the United States) or 313-234-6146 (not toll-free for callers outside the U.S.). This telephone hotline is available Monday through Friday, 8 a.m. to 4:30 p.m. Eastern Time.

You can also email FBAR-related questions to FBARquestions@irs.gov.

Contact BSAEFilingHelp@fincen.gov or by calling the BSA E-Filing Help Desk at 866-346-9478 (toll-free inside the United States) for assistance with electronic filing questions. The E-Filing Help Desk is open Monday through Friday from 8 a.m. to 6 p.m. Eastern Time.

ARTICLE SOURCES

  1. IRS. “Report of Foreign Bank and Financial Accounts (FBAR).” 
  2. IRS. “Do I Need to File Form 8938, ‘Statement of Specific Foreign Financial Assets?
  3. IRS. “Part 8, Chapter 11, Section 6. FBAR Penalties.”
  4. IRS. “IRS FBAR Reference Guide.” Pages 7-8.