Form 8938 and FBAR Requirements

SEE ALSO > Foreign Bank Account Reports

Important information for clients on when a FBAR report is required versus a Statement of Specified Foreign Financial Assets need to be submitted. Below we have included a chart that addresses key areas of including when the report is due, what information needs to be included and potential penalties.

	Statement of Specified Foreign Financial Assets	Report of Foreign Bank and Financial Accounts (FBAR)
Who Must File?	Specified individuals, which include U.S citizens, resident aliens, and certain non-resident aliens that have an interest in specified foreign financial assets.	U.S. persons, which   include U.S. citizens, resident aliens, trusts, estates, and domestic entities that have an interest in foreign financial accounts and meet the reporting threshold.
Does the United States include U.S. territories?	No	Yes, resident aliens of U.S territories and U.S. territory entities are subject to FBAR reporting
Reporting Threshold	$50,000 on the last day of the tax year or $75,000 at any time during the tax year (higher threshold amounts apply to married individuals filing jointly and individuals living abroad)	$10,000 at any time during the calendar year
When do you have an interest in an account or asset?	If any income, gains,   losses, deductions, credits, gross proceeds, or distributions from holding or   disposing of the account or asset are or would be required to be reported, included, or otherwise reflected on your income tax return	Financial interest: you are the owner of record or holder of legal title; the owner of record or holder of legal title is your agent or representative; you have a sufficient interest in the entity that is the owner of record or holder of legal title.Signature authority: you have authority to control the disposition of the assets in the account by direct communication with the financial institution maintaining the account.
What is Reported?	Maximum value of specified foreign financial assets, which include financial accounts with foreign financial institutions and certain other foreign non-account investment assets.	Maximum value of  financial accounts maintained by a financial institution physically located in a foreign country
When Due?	By due date, including extension, if any, for income tax return	Received by June 30 (no extensions of time granted)
Penalties	Up to $10,000 for failure to disclose and an additional $10,000 for each 30 days of non-filing   after IRS notice of a failure to disclose.	If non-willful, up to $10,000; if willful, up to the greater of $100,000 or 50 percent of account balances; criminal penalties.

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