FBAR

FBAR, or the Report of Foreign Bank and Financial Accounts, is a U.S. federal reporting requirement under the Bank Secrecy Act, administered by the Financial Crimes Enforcement Network (FinCEN). U.S. persons must file FinCEN Form 114 if they have a financial interest in, or signature authority over, at least one account located outside the United States and the aggregate value of all foreign financial accounts exceeded $10,000 at any time during the calendar year.

Who must file: U.S. citizens, residents, and certain entities with a financial interest in or signature authority over foreign financial accounts are required to file. The obligation applies regardless of whether the accounts earned income. Accounts can include bank, securities, brokerage, mutual fund, and other financial accounts maintained outside the U.S. Amounts held jointly may be attributed to filers, depending on their interest or authority.

Form and filing: The FBAR is filed electronically using FinCEN’s BSA E-Filing System. It is separate from and not filed with a U.S. tax return. The report requires identifying information about the filer and details of all foreign accounts.

Due date and extensions: The FBAR is due by April 15 of the following year, with an automatic extension to October 15 if needed.

Penalties: Noncompliance can lead to civil penalties for non-willful violations and more severe penalties for willful violations, including substantial monetary penalties and possible criminal penalties. Penalties may be assessed per violation and per account and may apply even in cases of inadvertent noncompliance. Amounts are subject to periodic adjustment.

Relation to FATCA: FBAR is separate from FATCA reporting requirements under Form 8938; some taxpayers may need to file both.