FBAR (FinCEN 114): Who Must File and What It Costs to Skip

Written by CA Sumit ChandwaniChartered Accountant & Founder · Reviewed by Minal Bihani, EA

The FBAR is one of the most missed filings in US tax, and one of the most expensive to miss.

• FBAR stands for Foreign Bank Account Report — officially FinCEN Form 114.
• It's an information report, not a tax return. Filing it doesn't create tax by itself.
• The trigger is simple: US persons whose foreign financial accounts, combined, exceeded $10,000 at any moment during the year.

Who counts as a "US person"

US citizens, green-card holders, and residents who meet the substantial presence test — plus US entities like LLCs, corporations and trusts. Living abroad does not exempt you; a US citizen in Dubai with a local bank account is squarely in scope.

What accounts count

Bank accounts, brokerage accounts, mutual funds, and many foreign pension or e-money accounts. Signature authority counts too: if you can move money in a foreign account — even your employer's — it may need to be reported.

The deadline

FBAR is due April 15 with an automatic extension to October 15 — no extension request needed. It's filed electronically with FinCEN through the BSA E-Filing System, separately from your tax return.

What it costs to skip

Non-willful violations can draw penalties in the low five figures per violation; willful violations can reach the greater of $100,000+ or half the account balance. The IRS has streamlined and delinquent-filing programs for people who genuinely didn't know — catching up before they contact you is dramatically cheaper.

FBAR vs Form 8938

Form 8938 (FATCA) is a separate report filed with your tax return, with higher thresholds. Many filers need both. Different form, different agency, different penalty — one doesn't satisfy the other.

The bottom line

If your foreign accounts ever crossed $10,000 combined, file the FBAR. It costs nothing in tax and protects you from some of the harshest penalties in the code. MOREOFTAX prepares FBARs, Form 8938 and catch-up filings for US persons worldwide.