Most people who owe an FBAR do not think they owe one. They are not careless. They read something reasonable, applied it to their own situation, and got the wrong answer, because the rule is not the one that most articles imply.
Here is what actually matters.
FBAR is not part of your tax return
FBAR stands for Report of Foreign Bank and Financial Accounts. The form is FinCEN Form 114, and it goes to the Financial Crimes Enforcement Network through the BSA E-Filing system, not to the IRS with your 1040.
That separation matters more than it sounds. Your tax preparer can file a perfectly correct return for you and you can still have an unfiled FBAR sitting behind it. Filing one does not file the other, and owing no tax does not mean you owe no report.
The $10,000 line is not your year-end balance
This is the single most common misunderstanding we see, and it costs people who were genuinely trying to do the right thing.
The threshold is not per account. It is not the balance on December 31. It is the combined highest balance across all of your foreign accounts at any point during the calendar year, even if that peak lasted a single day.
Two accounts holding $6,000 each cross it. One account that briefly held a property sale or a transfer in transit crosses it. An account you emptied in March crosses it, even though it showed zero for the rest of the year.
A foreign account that temporarily received approximately $50,000 from the sale of property abroad also crosses it, even if the funds were transferred to the United States two days later and the account balance was zero on December 31.
Many people assume there is nothing to report because they focus on the year-end balance. The FBAR threshold, however, is based on the highest combined balance during the year, not the balance on the last day of the year.
Which accounts count
The other half of the problem is what people picture when they hear "foreign bank account." They picture a checking account. The reporting is broader than that.
Accounts we regularly find that clients had not counted:
- Foreign brokerage and investment accounts
- Foreign pension and retirement accounts, depending on how they are held
- Accounts where you are not the owner but you hold signature authority, for example a parent's account or an employer's account
- Accounts held jointly with a spouse or family member
- Accounts you no longer use but never closed
That last two categories catch people constantly. We have sat with clients who believed they were fully compliant, gone through their accounts together, and found several reportable ones they had never thought of as "theirs" in the relevant sense.
If you can access it, or your name is on it, it is worth listing before you decide it does not count.
Who has to file
FBAR applies to US persons, which is broader than US citizens. It includes green card holders and anyone treated as a resident for tax purposes, and it includes US entities such as corporations, partnerships and LLCs.
It applies whether or not you live in the United States, and whether or not the account earned a single dollar of income.
When it is due
FBAR is due April 15, with an automatic extension to October 15. You do not have to request the extension and there is no form to file for it.
We still treat April as the real date, because an extension that nobody has to ask for is also an extension that is easy to forget you are relying on. More on that in when FBAR is due, and why the extension is automatic.
FBAR and Form 8938 are not the same thing
Form 8938 is the FATCA reporting form, it goes to the IRS with your tax return, and it has different thresholds and a different definition of what counts.
Plenty of people file one and not the other. Many people genuinely need both, and the overlap is not complete in either direction. If someone tells you that filing 8938 covers your FBAR obligation, that is wrong.
If you are already behind
Being late on FBAR is common and it is fixable. There is a defined path for people who have unreported accounts but no unreported income, and a different path for people who also have income to correct.
What matters is that stepping forward voluntarily puts you in a much better position than being found. See you missed FBAR: here is the path back and FBAR penalties, and what actually happens in practice.
The key point
Add up the highest balance each foreign account reached at any point last year, including brokerage, pension, joint and signature-authority accounts. If that combined figure crossed $10,000 even briefly, you have a filing to make, regardless of what the accounts hold today and regardless of whether you owe any tax.
If you are not sure, that uncertainty is itself the answer to whether it is worth a conversation. Tell us your situation in a few sentences and we will be happy to help you work out whether you have any US reporting obligations.
Thresholds, deadlines and penalty amounts change every filing year. This guide is reviewed against the current year, and it is educational rather than advice about your own situation. Before you act on anything here, check it with us.