Reporting Foreign Accounts: the FBAR and Form 8938

Two reports catch more visa holders by surprise than any tax: the FBAR and Form 8938. Neither one usually adds a dollar of tax. Both exist so the US government can see accounts held abroad, and both carry penalties far larger than the tax most people owe on those accounts. The good news is that the rules are mechanical. If you know who counts as a US person, which accounts count, and how to measure them, you can tell in a few minutes whether either report applies to you. This chapter lays out both, side by side, with the 2026 thresholds.

Who has to think about this

Both reports apply to US persons, and for tax purposes a US person includes a resident alien: someone with a green card, or anyone who passes the substantial presence test described in chapter 1. A nonresident alien, such as an F-1 student in the exempt years, generally does not file either one. Your visa type does not decide it; your tax residency does.

FinCEN's own filing instructions say that a US resident, for the FBAR, is determined by the residency tests in section 7701(b) of the tax code, the same tests that make you a resident for income tax. Form 8938 uses the term "specified individual", which includes a resident alien for any part of the tax year, and also a nonresident alien who elects to be treated as a resident in order to file a joint return (chapter 8). Whether that election also creates an FBAR duty for the spouse is a question FinCEN's instructions do not address directly; if it applies to your household, ask a preparer rather than assume either way.

The FBAR: every account, a low threshold

The FBAR (FinCEN Form 114) is filed online with the Financial Crimes Enforcement Network, not with your tax return. You must file if you had a financial interest in, or signature authority over, foreign financial accounts whose combined value exceeded $10,000 at any time during the calendar year.

Three words in that sentence do most of the work.

• Combined. The threshold applies to all your foreign accounts added together. Five modest accounts can cross it when no single one does.
• At any time. The test uses each account's highest balance in the year, not the year-end balance. A deposit that briefly held the proceeds of a sale counts at its peak.
• Signature authority. An account you can operate but do not own, such as a parent's account where you are a joint holder or mandate holder, can count. Joint accounts are reported at their full value by each owner, with a narrow exception for spouses who file one report together and keep FinCEN Form 114a on record.

Accounts that count include bank savings and current accounts, fixed deposits, foreign mutual fund holdings, and foreign-issued life insurance with a cash value. The IRS comparison table also lists accounts at a foreign branch of a US bank as reportable on the FBAR. Real estate held directly is not an account and is not reported.

The FBAR is due April 15 after the calendar year, with an automatic extension to October 15; you do not need to request it. Values are converted to dollars at the Treasury's reporting rate for the last day of the calendar year. FinCEN requires you to keep account records for five years.

Form 8938: fewer filers, more kinds of asset

Form 8938, the Statement of Specified Foreign Financial Assets, comes from a separate law (FATCA) and is attached to your income tax return. Its thresholds are much higher and depend on filing status and where you live. For a taxpayer living in the United States in 2026:

Crossing either column triggers the form. Thresholds are higher for people who live abroad, for example $200,000 at year end or $300,000 at any time for an unmarried filer, which matters in a year you move back.

Form 8938 covers more than accounts. Foreign stock or bonds held directly, an interest in a foreign partnership, foreign pension and deferred compensation plans, and an interest in a foreign trust can all be specified foreign financial assets. Like the FBAR, it does not cover real estate you hold directly. Assets already reported on certain other forms, such as Form 8621 for foreign funds (chapter 4) or Form 3520, are not listed again, but their value still counts toward the threshold. And if you do not have to file an income tax return at all, you do not file Form 8938.

Two separate duties

The most common mistake is treating one report as covering the other. They come from different laws, go to different agencies, have different thresholds and list slightly different assets. Many people with foreign accounts file the FBAR and not Form 8938; people with larger holdings often file both, listing the same bank accounts on each. Filing one never satisfies the other.

Penalties, stated carefully

The penalties are the reason this chapter exists, so here is what the primary sources actually say.

Form 8938. Failing to file when required carries a penalty of $10,000, plus up to $50,000 more if you continue not to file after the IRS notifies you. A separate 40% penalty can apply to an understatement of tax linked to undisclosed assets. Not filing can also keep the time the IRS has to assess tax open, for all or part of that return, until three years after the form is finally filed (the Form 8938 instructions; section 6501(c)(8) of the tax code).

FBAR. The statute sets the civil penalty for a non-willful violation at up to $10,000, and for a willful violation at up to the greater of $100,000 or 50% of the account balance. Both maximums are adjusted for inflation every year, so the figure applied today is higher than the one in the statute; the IRS FBAR page notes the yearly adjustment and links to it. In 2023 the Supreme Court held, in Bittner v. United States, that the non-willful penalty applies per report, not per account. Criminal penalties exist for willful cases.

These are maximums, not automatic charges, and the IRS has procedures for people who missed filings without intent. The streamlined filing compliance procedures are for taxpayers who certify their failure was non-willful and whom the IRS has not already begun examining; there are separate procedures for late FBARs and late information returns when no tax is unpaid. Which path fits depends on facts worth reviewing with a professional, but the direction from the IRS is plain: if you missed a year and have not been contacted, file as soon as you can.