FBAR (FinCEN 114)
The FBAR (Report of Foreign Bank and Financial Accounts), filed on FinCEN Form 114, is an annual disclosure required under the Bank Secrecy Act for US persons who have a financial interest in, or signature authority over, one or more foreign financial accounts whose aggregate value exceeded $10,000 at any point during the calendar year.
The FBAR requirement predates FATCA by decades, originating in the Bank Secrecy Act of 1970. Unlike FATCA's Form 8938, which is filed with the IRS as part of a tax return, the FBAR is filed electronically with the Financial Crimes Enforcement Network (FinCEN), a bureau of the US Treasury Department, by April 15 of the following year (with an automatic extension to October 15).
The filing threshold of $10,000 applies to the aggregate value across all foreign accounts, not per account. A US person with three foreign accounts each holding $5,000 at their peak must file an FBAR because the aggregate reached $15,000. The requirement applies to bank accounts, brokerage accounts, mutual funds, and certain other financial accounts held at institutions physically located outside the United States.
The penalty structure for FBAR violations is notoriously harsh. Non-willful violations carry a civil penalty of up to $10,000 per violation (per account per year). Willful violations carry civil penalties of the greater of $100,000 or 50 percent of the balance in the account at the time of the violation, and can result in criminal prosecution. The Supreme Court's 2023 decision in Bittner v. United States ruled that the non-willful penalty applies per form (per year) rather than per account, moderating what had been an extreme penalty regime.
FBAR and FATCA are distinct but complementary reporting regimes. An individual with a single foreign account may be required to file both, with similar but not identical information. Tax advisors counsel expatriates, dual citizens, and anyone receiving foreign income to map their filing obligations under both regimes annually.