BSA FBAR Filing and Reporting Requirements

The Report of Foreign Bank and Financial Accounts (FBAR) is an informational report filed with the Financial Crimes Enforcement Network (FinCEN), a bureau of the U.S. Department of the Treasury. Authorized under the Bank Secrecy Act (BSA), the FBAR provides transparency into the foreign financial holdings of U.S. persons.

The information collected allows investigators to follow financial trails that might otherwise be hidden offshore and helps the government deter illegal activities like tax evasion and money laundering. The FBAR is separate from an annual income tax return and does not assess tax; its purpose is to ensure U.S. persons do not use foreign accounts to conceal assets from U.S. authorities.

Who Must File an FBAR

The obligation to file an FBAR applies to any “U.S. person” who has a financial interest in or signature authority over foreign financial accounts, and the total value of those accounts exceeds $10,000 at any time during the calendar year. The definition of a U.S. person is broad, including U.S. citizens, residents, and domestic entities like corporations, partnerships, LLCs, trusts, and estates. A parent or guardian can file on behalf of a minor who meets the filing requirements.

The $10,000 threshold is based on the aggregate value of all foreign accounts. A person must sum the highest values of each of their foreign accounts during the year, and if that combined total surpasses $10,000, the reporting requirement is triggered. For example, having three foreign accounts with maximum values of $4,000 each during the year would require an FBAR filing because their aggregate value of $12,000 exceeds the limit.

A financial interest applies to the owner of record or legal title holder. It can also apply indirectly, such as when an account is held by an entity in which a U.S. person owns more than 50 percent.

Signature authority is a concept that applies to individuals who can control the disposition of assets in the account by direct communication with the financial institution. For instance, a corporate officer who has the power to direct payments from a company’s foreign account, or an individual holding a power of attorney over a relative’s foreign account, would be considered to have signature authority and would need to file an FBAR.

Information and Documentation Required for Filing

To complete FinCEN Report 114, filers must gather specific information for each foreign account. This includes personal identifying information for the filer, such as their Social Security Number or Individual Taxpayer Identification Number (ITIN), and similar information for any joint owners.

For each account, the filer must provide the following:

• The name of the individual or entity on the account
• The account number or other designation
• The full name and mailing address of the foreign financial institution
• The type of account, such as a bank, securities, or mutual fund account
• The maximum value during the calendar year, reported in U.S. dollars

To convert from a foreign currency, filers may use any U.S. Treasury Bureau of the Fiscal Service exchange rate published during the reporting year, provided the chosen rate is used consistently. These rates can be found on the Bureau of the Fiscal Service website. It is a sound practice to keep records of the documents used to determine account values, as FinCEN may request them for verification.

The FBAR Filing Process

The FBAR must be filed electronically using the BSA E-Filing System, which is managed by FinCEN, as paper filings are not accepted in most cases. The process begins by accessing the FinCEN website, where a filer can enter information directly into a web-based form or complete a PDF version offline and then upload it. Individuals filing for themselves can use the system’s online form without registering, while professionals filing for clients must register as an institution.

The annual deadline for filing the FBAR is April 15 of the year following the calendar year being reported. However, an automatic six-month extension to October 15 is granted to all filers, so no special request is needed to use the later deadline.

After the FBAR is submitted, the filer will receive an email confirmation that includes a unique BSA ID number. This ID serves as proof of filing, and it is important to save this confirmation for personal records.

Penalties for Non-Compliance

Failing to file an FBAR when required, or submitting an inaccurate report, can lead to penalties. The severity depends on whether the violation is determined to be non-willful or willful.

For non-willful violations, where the failure to file was due to a mistake or negligence, the civil penalty can be up to a specific inflation-adjusted amount per unfiled report. If the IRS determines that the violation was due to reasonable cause and the person later files the correct FBARs, it may choose to waive the penalty.

The penalties for willful violations are more severe and can include both civil and criminal charges. For 2025, the civil monetary penalty for a willful violation can be the greater of $165,353 or 50 percent of the highest balance in the unreported accounts. This means the penalty can sometimes exceed the total amount in the foreign accounts. Willful violations can also lead to criminal prosecution, which may result in fines and imprisonment.

Distinguishing FBAR from Form 8938

A common area of confusion is the difference between the FBAR and Form 8938, the Statement of Specified Foreign Financial Assets. The FBAR is a requirement under the Bank Secrecy Act and is filed with FinCEN, whereas Form 8938 is mandated by the Foreign Account Tax Compliance Act (FATCA) and is filed with the IRS.

The filing methods also differ. The FBAR is filed electronically and separately from a tax return through the BSA E-Filing System. In contrast, Form 8938 is attached to and filed as part of a taxpayer’s annual federal income tax return, so its due dates align with income tax filing deadlines.

The reporting thresholds are another difference. The FBAR requirement is triggered when the aggregate value of foreign financial accounts exceeds $10,000 at any point during the year. The thresholds for Form 8938 are higher and more complex, varying based on the taxpayer’s filing status and whether they reside in the U.S. or abroad.

For example, for an unmarried individual living in the U.S., the Form 8938 filing threshold is met if the total value of specified foreign financial assets is more than $50,000 on the last day of the tax year or more than $75,000 at any time during the year. Because the requirements are independent, a person may need to file one form, both, or neither.