A Reminder for U.S. Citizens with Foreign Bank Accounts, It’s FBAR Time!

The purpose of this post is to remind U.S. Citizens and U.S. residents to file their FBAR by April 15th if they have foreign bank accounts whose aggregate value exceeded $10,000 USD at any time during the calendar year

I’ve covered this topic in detail in the past; however, I like to bring it up again around tax time because failure to file this report can result is some severe civil and/or criminal penalties.

In other words, I’m just trying to help folks stay out of trouble with Uncle Sam.

If you have no idea what I’m talking about, click HERE to read more about the Report of Foreign Bank and Financial Accounts (FBAR).

By the way, if you fail to file by April 15th, don’t worry — you get an automatic extension to October 15. But why wait and risk forgetting about it?

If you only have one or two accounts, you can knock this form out in about 10 minutes.

How to File

All filing is done electronically via FinCEN’s portal: click HERE

The instructions and requirements are available in PDF form via this link: FinCEN Form 114

Let’s Wrap This Up

Remember, this is all about asset tracking. Even if you don’t owe the IRS anything, you could still lose some of your hard-earned money if you fail to file this annual report when required to do so.

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About the Author

Q-Roo Paul
Paul Kurtzweil (Q-Roo Paul) was a deputy sheriff in Florida for 25 years before retiring at the rank of lieutenant in 2015. He and his wife moved to Mexico looking for to maximize their retirement income. In 2016, they started a blog called Two Expats Mexico (qroo.us) sharing their experiences, as well as information about the logistical and legal aspects of retiring south of the border. The blog has been viewed over two million times and the articles have been republished in numerous periodicals across Mexico.

15 Comments on "A Reminder for U.S. Citizens with Foreign Bank Accounts, It’s FBAR Time!"

  1. Paul, it is my understanding that with the FBAR filing, an automatic six month extension allows everyone to file as late as approximately October 15. However, it is easier to just take care of it when you have all the paperwork pulled together for taxes.

  2. Carl and Lisa Drake | February 12, 2018 at 8:57 am |

    Paul, We did not let our bank account exceed $9999.00 this year. In fact, we stayed about $1K beneath that, all year. When I did my taxes with Turbo Tax, it asked and I answered no. I believe we are OK. What do you think? Also, I would like to contact you regarding another question, at your convenience, sometime. Thank you very much for all of your invaluable information. It has really helped us adjust to Mexico living.

    • Then you don’t have to file the report.

      If you have any other questions, you can send them to me via the contact form. We stay pretty busy, so sometimes it takes us a few days to get back to people.

  3. cheryl okerlund | February 12, 2018 at 9:12 am |

    Paul, do the banks report any amount or only those with balances over $10k?

  4. Hi Paul,

    Thanks for the reminder. If I understand correctly, the Bank Trust (fidelcomiso) that most of us expats use to own property in Rivera Maya is considered exempt from the filing requirement. Do you know if that is still true?

  5. That’s why most banks all over the world do not want to open bank accounts for US citizens because they have so much reporting burdens and have to invest tons of money in their system to report to the US government about US citizens bank accounts. Talking about US government spies with no pays.

    This makes the US passport one of the worst banking passports in the whole world. It’s better to get a Canadian / UK / European passport with no banking issues worldwide, no worldwide income tax obligation to their government for being an expat and live tax free, and enjoy NON-GMO food and far far better health care system!! 😉 LOL

    On IRS website, the reporting thresholds are different for Americans living in the US and outside of the US (expats).

    Reporting Thresholds

    Reporting thresholds vary based on whether you file a joint income tax return or live abroad. If you are single or file separately from your spouse, you must submit a Form 8938 if you have more than $200,000 of specified foreign financial assets at the end of the year and you live abroad; or more than $50,000, if you live in the United States. If you file jointly with your spouse, these thresholds double. You are considered to live abroad if you are a U.S. citizen whose tax home is in a foreign country and you have been present in a foreign country or countries for at least 330 days out of a consecutive 12-month period.

    Taxpayers living abroad. You must file a Form 8938 if you must file an income tax return and:

    You are married filing a joint income tax return and the total value of your specified foreign financial assets is more than $400,000 on the last day of the tax year or more than $600,000 at any time during the year. These thresholds apply even if only one spouse resides abroad. Married individuals who file a joint income tax return for the tax year will file a single Form 8938 that reports all of the specified foreign financial assets in which either spouse has an interest.
    You are not a married person filing a joint income tax return and the total value of your specified foreign financial assets is more than $200,000 on the last day of the tax year or more than $300,000 at any time during the year.
    Taxpayers living in the United States. You must file Form 8938 if you must file an income tax return and:

    You are unmarried and the total value of your specified foreign financial assets is more than $50,000 on the last day of the tax year or more than $75,000 at any time during the tax year
    You are married filing a joint income tax return and the total value of your specified foreign financial assets is more than $100,000 on the last day of the tax year or more than $150,000 at any time during the tax year.
    You are married filing separate income tax returns and the total value of your specified foreign financial assets is more than $50,000 on the last day of the tax year or more than $75,000 at any time during the tax year. For purposes of calculating the value of your specified foreign financial assets in applying this threshold, include one-half the value of any specified foreign financial asset jointly owned with your spouse. However, report the entire value on Form 8938 if you are required to file Form 8938.

    https://www.irs.gov/businesses/corporations/summary-of-fatca-reporting-for-us-taxpayers

  6. The way the pesos fluctuates all year can affect if you have $ 10,000 USD in your account or not. Am I wrong thinking this?

  7. Paul,

    I don’t think what you wrote “It is my understanding that they report them all to the IRS.” is correct.

    I was told by Intercam account manager that they only report when IRS requests.

    You may want to verify with them.

    Maybe it depends on individual banks?

    Thank you for all your posts.

    Best wishes.

    • According to the provisions of FATCA, it is the responsibility of the financial institutions to search their records for “U.S. persons” and to report their assets and identify such persons to the U.S. Department of Treasury.

      Since the purpose is to identify accounts that they may not even know exist, how
      could they request them?

      I checked the IRS site and it puts the burden on the financial institutions to report the account holders. There is nothing that says something like “when requested to do so”.

      I suspect that the reporting is not done at the branch level. That might be why the account manager gave you that answer.

  8. Deborah L Soloway | February 13, 2018 at 5:11 pm |

    This year’s deadline is April 17, 2018, as April 15 is a Sunday and April 16 is a holiday in the District of Columbia. Also, your readers with US tax questions might want to join the Facebook group, US Expat Tax Questions, moderated by a US CPA, at https://www.facebook.com/groups/952367774780623/

Comments are closed.