Foreign Bank Account Reporting (FBAR)

Critical Change in E-filing: Before July 1, 2013, FBARs were filed using the paper Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts, with Treasury in Detroit. As of July 1, 2013, FBARs must be electronically filed (e-filed) with Treasury via the BSA website. The e-filing mandate applies to FBARs due for the calendar year ending Dec. 31, 2013, and for any late or amended FBARs filed for earlier years. As a result, the below discussed Form TD F 90-22.1 can no longer be used.


Foreign Bank and Financial Account Reporting Must Be Electronic

Foreign Bank and Financial Account Reporting (FBAR)

The following gives a brief overview of the filing requirements when someone has a bank account or foreign financial assets in a foreign country that exceeds $10,000.

Reporting of Foreign Bank Account and Other Financial Assets Exceeding $10,000

In addition to the income tax disclosure requirements discussed below, the following taxpayers are required to file electroncially FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR, formerly Form TD F 90-22.1), annually if they have a financial interest in or signature authority over financial accounts, including bank, securities or other types of financial accounts, in a foreign country, if the aggregate value of these financial accounts exceeds $10,000 at any time during the calendar year:

  • Citizens
  • Residents
  • Corporations and partnerships
  • Trusts and estates
  • Tax-exempt organizations

In addition, FBAR filers include individuals (e.g., a business’s officers and employees) with a financial interest in or signature authority over any non-personal foreign financial accounts (e.g., business bank accounts).

An FBAR for an individual must be filed on a separate return basis. Account holders may not file a joint FBAR even when filing joint federal income tax returns. However, under the regulations, Form 114 instructions, and the Internal Revenue Manual, a spouse who has only a financial interest in a joint account that is reported on the other spouse’s FBAR does not have to file a separate FBAR.

In general, a domestic corporation with an FBAR filing requirement can file an FBAR on a consolidated basis with other domestic entities in which it has an ownership interest of greater than 50%, in terms of vote, value, or control; however, restrictions may apply.

FinCEN FORM 114 Electronic Filing Due Date

The form must be electronically filed by June 30 of the year following the calendar year being reported. The FBAR is filed with the Treasury through FinCEN’s BSA E-Filing System on the BSA website. It no longer can be filed by mail as e-filing of the FBAR is now mandatory and the exclusive method of filing.

Income Tax Filing Extension Does Not Help or Apply to This Separate Filing

The June 30 filing date may not be extended. Failure to timely file a complete and accurate FBAR may result in significant civil penalties, criminal penalties, or both.

Civil and Criminal Penalties Can Be Significant

Civil penalties for failure to comply with the filing requirements can add up quickly. They may include a combination of penalties for negligence, pattern of negligence, non-willful violations, and willful violations.

Civil penalties for a willful violation can range up to the greater of $100,000 or 50 percent of the amount in the account at the time of the violation.

Criminal penalties for violating the FBAR requirements while also violating certain other laws can range up to a $500,000 fine or 10 years imprisonment or both.

Civil and criminal penalties may be imposed together.

Earlier Years

If you determine that you were required to file FBARs for earlier years, you should file the delinquent FBAR reports and attach a statement explaining why the reports are filed late. No penalty will be asserted if IRS determines that the late filings were due to reasonable cause. Keep copies, for your records, of what you send.

Reminder: The e-filing mandate applies to FBARs due for the calendar year ending Dec. 31, 2013 and thereafter, and for any late or amended FBARs filed for earlier years.

Unreported Income Related To Foreign Accounts

If, however, you have any unreported taxable income related to the foreign accounts, you should instead follow the procedures for making a voluntary disclosure to IRS under the third Streamlined Offshore Voluntary Disclosure Initiative. For more on this please see my article entitled US Citizens Living Outside America: Streamlined Foreign Offshore Procedure Offers Tax and Compliance Relief

Income Tax Return Disclosure Requirements:

Form 1040, Schedule B:

At the bottom of Schedule B of the Form 1040, the IRS asks whether such accounts exist. Taxpayers must answer these FBAR related questions on such form and check the block on Form 1040, Schedule B, Part III.

Form 1040, attach Form 8938:

Certain individuals and domestic entities with specified foreign financial assets in excess of a threshold asset value report those assets on Form 8938, Statement of Specified Foreign Financial Assets, and attach Form 8938 to their federal income tax return at the time of filing. Be aware that the information to be reported on the income tax return via Form 8938 has its own rules, definitions, thresholds, and other requirements. For more details please read Foreign Accounts and Form 8938

Steve is an excellent attorney who has provided help for my family personally for business, tax, and other services for many years. He is extremely knowledgeable and thorough, and is extremely good at explaining legal concepts to me in clear terms understandable to a non-attorney. It is difficult to pick only three attributes above, since Steve’s work meets most if not all of the attributes above.
Jonathan Weiss, November 11, 2008


1420 Walnut Street Suite 300
Philadelphia, PA 19102

Telephone: 215-735-2336

Connect With Us:


In order to help you more quickly, please
fill out the form and click “submit”.
A representative of the firm will call you shortly.

  • This field is for validation purposes and should be left unchanged.

From their offices in Philadelphia, PA, the law firm of Steven J. Fromm & Associates, P.C. provides a full range of estate planning, probate and estate administration, tax, business and corporate legal services to clients throughout eastern Pennsylvania and the Delaware Valley, the Lehigh Valley Area, the Five-County Area, Bucks County, Delaware County, Montgomery County, Chester County, Philadelphia County, Berks County, Lehigh County, Lancaster County, York County, Harrisburg, Norristown, Doylestown, Media, West Chester, Allentown, Lancaster, and Reading.