What Is an FBAR and Who Has to File One?
Sam's List Editorial | 2026-08-01
What Is an FBAR and Who Has to File One? An FBAR is the Report of Foreign Bank and Financial Accounts, filed on FinCEN Form 114. A US person must file one for any calendar year in which the combined value of their foreign financial accounts exceeded $10,000 at any point, even for a single day. It is not a tax return, it is not filed with your tax return, and it is required whether or not you owe any tax. That last part is what catches people. The FBAR exists under the Bank Secrecy Act, at 31 U.S.C. section 5314 and 31 CFR section 1010.350, and its purpose is disclosure rather than revenue. You can have a zero tax liability, a fully reported income picture, and still have an FBAR obligation with real penalties attached to missing it. Who Has to File an FBAR A US person means a US citizen, a US resident, and also domestic entities: corporations, partnerships, LLCs, trusts, and estates. Being abroad does not exempt you, and neither does the account being small on its own. You have to file if you had either of the following during the year: A financial interest in one or more foreign financial accounts, meaning you are the owner of record or holder of legal title, including through certain entities you control. Signature authority over a foreign financial account, meaning you can control the disposition of assets in it, even if none of the money is yours. Signature authority is the requirement people miss most often. An employee who can sign on a foreign subsidiary's bank account, or a family member added to a parent's overseas account, may have a personal filing obligation over money they do not own and never touch. The $10,000 Threshold Is Aggregate, Not Per Account The most frequent misreading of the rule is treating $10,000 as a per-account test. It is not. You add up the maximum value of every foreign account during the year, and if the combined figure exceeds $10,000 at any point, you report all of them. Here is the arithmetic in practice. You hold three foreign accounts with peak balances of $4,000, $5,000, and $2,000. No single account crosses $10,000. The combined maximum is $11,000, so you file, and you report all three accounts, including the $2,000 one. The value is the maximum during the calendar year, not the year-end balance, converted to US dollars using the Treasury year-end exchange rate. A balance that spiked because a property sale passed through the account for a week still counts. What Counts as a Foreign Financial Account Generally: bank accounts, savings and checking accounts, securities and brokerage accounts, mutual funds, and...
