FBAR vs. Form 8938: a detailed guide to key differences and filing thresholds
Handling foreign financial exposure as a US expat means getting FBAR and Form 8938 right, not just hoping you’ll be safe. We lay out the firm requirements for each, walk through threshold triggers in straightforward language, and compare both paths so you know your filing strategy. It’s designed for clarity, not tax-jargon overload.
This article is brought to you by Taxes for Expats, a trusted partner helping Americans abroad navigate complex filings with confidence. In it, we detail the difference between FBAR and Form 8938 and offer practical advice so you meet the correct requirements and hit the right threshold every time. Learn more about our services or contact us to get expert assistance today.
What is FBAR (FinCEN Form 114)?
Most expats experience similar stories; let’s look at a typical scenario we’ve often heard — an American professional, let’s call him Jeremy, living in Paris, whose two local accounts quietly grew to 12,400 dollars in 2025. That scenario alone triggered an FBAR filing requirement for him. To avoid surprises like Jeremy’s, it helps to understand exactly what FBAR means and when it applies.
The FBAR, officially called FinCEN Form 114, is an annual report for foreign bank, brokerage, and similar accounts held outside the US whenever their combined value exceeds 10,000 dollars at any time during the year. It must be filed electronically through the BSA E-Filing System by April 15, with an automatic extension to October 15.
For 2025, the non-willful penalty cap is 16,536 dollars per report under Bittner, while willful violations can reach the greater of 165,353 dollars or 50% of the account balance. To better grasp the above, know that:
- A US person includes individuals and entities with a financial interest in, or signature authority over, foreign accounts.
- The threshold applies to all accounts combined – once it exceeds 10,000 dollars, every reportable account must be included, and records kept for five years.
- In contrast, Form 8938 covers specified foreign financial assets, using separate IRS thresholds often higher than the FBAR trigger.
- The key point: even moderate foreign balances can require filing Form 114, and timely reporting helps prevent steep penalties.
What is Form 8938?
When savings start turning into real investments abroad — like shares in a European startup or a growing balance in a foreign brokerage account — reporting rules shift. The same expat who once only filed an FBAR now faces a deeper layer of disclosure through Form 8938, designed to capture assets that reflect ownership and wealth held outside the US.
Introduced under the Foreign Account Tax Compliance Act (FATCA), Form 8938 reports specified foreign assets such as accounts, directly held stocks, or interests in foreign corporations and partnerships. For residents in the US, the threshold starts above 50,000 at year's end or 75,000 at any time for single filers, and 100,000 or 150,000 for joint filers. Those living abroad face higher limits – 200,000 or 300,000 for single filers, and 400,000 or 600,000 for joint filers, while specified domestic entities report when holdings exceed 50,000 or 75,000.
Some assets appear on both forms, especially foreign financial accounts held at non-US banks or brokers. But signature authority alone triggers only an FBAR filing unless there’s actual ownership or benefit from the asset. These requirements ensure the IRS sees a full picture of offshore wealth while avoiding unnecessary duplicate reporting.
FBAR vs Form 8938: essential differences
Foreign asset reporting can feel like walking a tightrope; one misstep, and the penalties get expensive fast. Understanding how Form 8938 vs FBAR works helps every US taxpayer stay compliant without duplicating work or missing key filings.
| Area | FBAR | Form 8938 |
|---|---|---|
| Who files | US persons with a financial interest in or signature authority over foreign accounts | Specified individuals and specified domestic entities holding specified foreign financial assets |
| What is reported | Foreign financial accounts and their maximum values | Foreign accounts and non-account assets such as directly held foreign stocks, interests in foreign entities, certain annuities, and life policies |
| Due date | April 15 with automatic extension to October 15 | With the income tax return due date, including extensions |
| Where filed | FinCEN through BSA E-Filing, separate from the tax return | Attached to the IRS return and filed with the return |
| Penalties snapshot | Civil penalties for non-willful and willful violations, plus potential criminal exposure | Failure to file begins at 10,000 dollars, up to 50,000 dollars additional after notices; 40 percent accuracy penalty on related understatements |
This quick comparison shows the difference between FBAR and Form 8938 in clear terms: two separate filings with distinct thresholds, agencies, and reporting scopes.
OBBBA updates & filing impact on FBAR and Form 8938
Recent legislative changes under the One Big Beautiful Bill Act (OBBBA) brought fresh inflation adjustments for 2026 filings. When the IRS released its October 9, 2025, update, the thresholds for both FBAR and Form 8938 remained untouched, meaning the same limits and due dates continue to apply for the 2025 tax year.
- FBAR keeps its April 15 deadline with an automatic October 15 extension, filed directly through FinCEN.
- For taxpayers weighing Form 8938 vs FBAR, the takeaway is simple: both stay in play for 2025 reporting, each serving a different compliance purpose.
What are the reporting thresholds for US filers?
Staying compliant starts with knowing the right thresholds for reporting foreign assets. Each form has its own limits, and grasping how they work together helps you see whether you need to file. FBAR and Form 8938 target different types of accounts and assets, yet both define when reporting becomes mandatory.
Take Emma, a US expat with a foreign bank account in France. Her combined balances reached 12,000 during the year, above the 10,000 threshold – so she must file an FBAR electronically with FinCEN, or Carlos, a business owner with foreign investments worth 250,000 in Spain, crosses the Form 8938 limit for those living abroad. Since his total assets exceed $200,000 at year's end, he needs to report them with his income tax return.
Then there’s Maya and Daniel, dual citizens with joint accounts abroad totaling 420,000. Since they are married & filing jointly, they exceed the 400,000 mark and must include Form 8938 along with their FBAR submission.
Specified domestic entities – corporations or trusts with foreign holdings – also have to report when their assets top 50,000 at year's end or 75,000 at any time. These filing lines ensure that FATCA and FinCEN reporting stay aligned, helping taxpayers stay transparent while avoiding costly penalties.
What counts as reportable assets
With filing thresholds unchanged through 2026, the contrast between FBAR and Form 8938 remains clear. Both aim to reveal foreign holdings, yet each sees assets through a different lens – one focused on where the money rests, the other on what you actually own.
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FBAR
Under the foreign financial accounts rules, Form 114 captures every bank, brokerage, or cash-value insurance account held outside the US once combined balances rise above $10,000 at any moment in the year. Even a modest overseas account can trigger the filing, since the total, not each balance, determines the obligation. -
Form 8938
FATCA’s reach under FBAR and Form 8938 extends beyond accounts to specified foreign financial assets – directly held shares, interests in foreign partnerships, and policies with cash value, among them. For taxpayers married filing jointly, reporting begins when total assets exceed $100,000 on the last day of the year or $150,000 at any point, reflecting how broadly the form defines ownership abroad.
Clear filing steps and timely deadlines
Think of the filing process as your yearly checkpoint for staying ahead of the IRS and FinCEN. Many miss simple deadlines that can lead to costly penalties but once you know what applies, when to act, and how to file, reporting your accounts becomes less stressful and more like a smart, confident routine.
Step 1: Confirm what applies to you. The $10,000 total balance rule triggers the FBAR, while Form 8938 applies when specified foreign assets exceed IRS thresholds ranging from $50,000 to $600,000, depending on filing status and residency.
Step 2: Collect every document that matters bank statements, ownership papers, and account details. Include institutions where you hold signature authority, even if you don’t own the funds, since both ownership and control count.
Step 3: Convert all balances to US dollars using the official year-end exchange rate. For FBAR, note each account’s highest value during the year; for Form 8938, capture both the year-end and peak amounts to ensure accuracy.
Step 4: File the FBAR electronically through FinCEN’s BSA E-Filing system using Form 114. The deadline is April 15 with an automatic extension to October 15 no separate request needed.
Step 5: Attach Form 8938 to your federal income tax return and submit it by your return’s due date, including extensions. Keep account records for five years from the FBAR due date to document compliance and protect against future inquiries.
When both FBAR and Form 8938 apply to you
Some expats are surprised to learn that one report doesn’t cancel out the other. Knowing when both are needed can help you stay compliant and avoid heavy penalties. FBAR is triggered once the total value of all your foreign bank and investment accounts tops 10,000 dollars at any point in the year. It’s filed online as FinCEN Form 114 by April 15, with an automatic extension to October 15.
Form 8938, on the other hand, kicks in when your combined foreign financial assets exceed 50,000 dollars for single filers in the US or 200,000 dollars for those living abroad at year-end. These thresholds rise for joint filers, which makes it important to double-check the official requirements on the IRS site. The Bittner v. United States ruling clarified that nonwillful FBAR penalties apply per report, not per account a major relief for those managing several overseas accounts when FBAR and Form 8938 both come into play.
Common mistakes that derail full compliance
Small slips on foreign reporting requirements can snowball into penalties. Thresholds vary for single filers and those married filing jointly, so context matters.
- Treating FBAR as the only filing where foreign accounts ever topped $10,000 can miss a separate FATCA obligation and invite scrutiny.
- Recording asset figures one way on Form 8938 but differently elsewhere undermines accuracy, with a single filer abroad facing $200,000 at year's end or $300,000 at any time.
- Disregarding jointly held accounts or accounts with only signature authority still counts toward the yearly total and must be considered.
- Overlooking enforcement tied to Form 114 ignores the per-report standard for nonwillful cases after Bittner and the potential for steep willful penalties.
Penalties for missing required filings
For Americans with assets abroad, the stress of managing cross-border accounts can turn into costly penalties if filing slips through the cracks. Both FBAR and Form 8938 have separate enforcement tracks, and when both are missed, the financial impact can quickly snowball.
FBAR penalties and enforcement
The government enforces FBAR reporting with precision. A non-willful lapse can cost up to $16,536 per report in 2025, while a willful failure can reach the greater of $165,353 or 50% of the account’s highest balance. In more serious cases, the Justice Department may add criminal charges that carry fines of $250,000 and up to five years in prison, or $500,000 and ten years when paired with other violations.
Form 8938 penalties and how they can stack
Form 8938 penalties often hit at the same time as FBAR violations, creating a double layer of risk. The initial fine is $10,000, followed by $10,000 for each 30 days of delay after an IRS notice, up to an additional $50,000. If income from foreign assets is understated, the IRS can apply a 40% accuracy penalty and extend the audit window for six years.
- Missing both filings can lead to $16,536 under FBAR, plus $10,000 to $50,000 under Form 8938; all for the same year.
- Each form covers different information, so one doesn’t replace the other.
- Keeping accurate records and filing on time protects against overlapping penalties that can drain savings fast.
Take, for example, a graphic designer living in Spain who overlooks both filings while juggling deadlines and travel. When the IRS finally contacts her, she’s facing parallel penalties, one for her bank accounts under FBAR and another for her investment portfolio under Form 8938. It’s a sobering reminder that even small oversights can multiply when both forms go unfiled.
How to stay compliant and avoid trouble
Life abroad is exciting, but tax reporting can feel like a maze. Knowing when to file FBAR and Form 8938 keeps that adventure worry-free and your accounts transparent. Taxes for Expats helps Americans around the world stay compliant with confidence, turning complex filing rules into peace of mind.
