FBAR and FATCA Reporting for US Expats: 2026 Complete Guide

US citizens abroad face two separate foreign account reporting requirements — FBAR (FinCEN 114) and FATCA (Form 8938). They overlap but are not the same. Miss either and you're looking at penalties that can dwarf the account value itself. Here's exactly what each requires, what triggers each, and how to fix it if you're behind.

FBAR vs. Form 8938: The Core Distinction

Expats frequently confuse these two requirements because they cover overlapping ground. They are legally distinct obligations filed with different agencies under different statutes:

Both can apply to the same account simultaneously. If you have a £500,000 UK brokerage account, you likely owe both an FBAR and a Form 8938 for that account — one to FinCEN and one attached to your IRS return.

FBAR: Foreign Bank Account Report (FinCEN 114)

Who Must File

Any "US person" — citizen, permanent resident (green card holder), or individual meeting the substantial presence test — who had a financial interest in or signature authority over one or more foreign financial accounts if the aggregate maximum value of those accounts exceeded $10,000 at any point during the calendar year.²

The $10,000 threshold is aggregate, not per account. Five foreign bank accounts each averaging $3,000, with a combined peak of $15,000, trigger FBAR even though no single account crossed $10,000.

What Accounts Trigger FBAR

• Foreign bank accounts (checking, savings, term deposits, current accounts)
• Foreign brokerage and securities accounts
• Foreign mutual funds (note: these are also likely PFICs — see PFIC rules)
• Foreign-issued life insurance or annuity contracts with a cash value
• Foreign hedge funds and private equity funds (if structured as financial accounts)

Not triggered by FBAR: real estate held directly (not through an entity), foreign employer pension plans (if no individual account), Social Security equivalent benefits, commodities held directly (not in an account).

How to File

FBAR is filed electronically through FinCEN's BSA E-Filing System (bsaefiling.fincen.treas.gov). It is not filed with your tax return. You can also authorize a third party (accountant, attorney) to file on your behalf using FinCEN Form 114a (Record of Authorization).

The FBAR covers the prior calendar year. The 2026 filing covers accounts held during 2025.

Deadline

April 15, 2026, for calendar year 2025. If you miss the April 15 deadline, there is an automatic extension to October 15 — no extension request needed, FinCEN grants it automatically.²

Penalties for Non-Filing

FBAR penalties are assessed per annual report (not per account), following the 2023 Supreme Court decision in Bittner v. United States.¹

• Non-willful violation: up to $16,536 per annual report (adjusted for inflation from the statutory $10,000 base). If you failed to file for five years, you're looking at up to $82,680 in civil penalties — even if you owed no additional tax.
• Willful violation: the greater of $165,353 or 50% of the highest aggregate account balance during the year. Per violation can mean per year. Five years of willful non-filing on a $500,000 account = potential exposure in the millions.
• Criminal penalties: up to $250,000 and/or 5 years in prison. For violations involving more than $100,000 in a 12-month period, up to $500,000 and/or 10 years.²

Penalties are capped at the per-report level for non-willful violations under Bittner, which was a meaningful taxpayer victory. Prior to that decision, the government argued $10,000 per account per year — which on a five-account, five-year situation meant $250,000 in non-willful penalties.

Form 8938: FATCA Reporting (IRC § 6038D)

Who Must File

US citizens and resident aliens with interests in "specified foreign financial assets" above the applicable threshold. For individuals living abroad (meeting the bona fide residence or physical presence test, same as FEIE eligibility):³

• Single or Married Filing Separately: file if total value exceeded $200,000 on the last day of the year, or $300,000 at any point during the year
• Married Filing Jointly: file if total value exceeded $400,000 on the last day of the year, or $600,000 at any point during the year

For US residents, the thresholds are much lower: $50,000/$75,000 (single) and $100,000/$150,000 (MFJ). Living abroad gives you a higher threshold, not an exemption.

What Counts as a "Specified Foreign Financial Asset"

Form 8938 covers more ground than FBAR:

• Financial accounts at foreign financial institutions (same as FBAR)
• Foreign stocks and securities not held in a financial account (e.g., stock certificates held directly)
• Foreign partnership interests, interests in a foreign estate or trust
• Foreign-issued notes, bonds, or debentures
• Interests in foreign corporations (depending on ownership percentage and other forms required)
• Foreign pension plans — if you have an interest in a foreign pension (UK SIPP, German pension, etc.), it may be reportable on Form 8938, even if not on FBAR

Filing and Deadline

Form 8938 is attached to your annual Form 1040. The deadline is your return deadline, including extensions. If you're living abroad, you have an automatic 2-month extension to June 15 for your return (no application needed), and you can extend further to October 15 with a Form 4868.³

Penalties

• Failure to disclose: $10,000 penalty per taxable year
• Continued failure after IRS notification: additional $10,000 for each 30-day period of non-filing (up to $50,000)
• Underpayment tied to undisclosed assets: 40% penalty on any tax underpayment attributable to undisclosed specified foreign financial assets (on top of the underlying tax)
• Statute of limitations: where Form 8938 omission is tied to a $5,000+ understatement of income from foreign financial assets, the IRS has 6 years to assess tax on that return (rather than the normal 3 years)

Late Filing Relief: How to Catch Up

Many US expats were simply unaware of these filing requirements — especially those who moved abroad before FATCA (which took effect in 2014) or who received poor advice from non-specialist advisors. There are formal IRS relief programs.

Delinquent FBAR Submission Procedures

If you never underreported income (your 1040s were correct, just missing the FBAR), you can simply file the late FBARs with a statement explaining why they were late. The IRS and FinCEN have generally not imposed penalties in this situation when income was correctly reported and there was a reasonable cause for non-filing.⁵

Streamlined Filing Compliance Procedures

For taxpayers with both delinquent FBARs and underreported foreign income, the IRS offers two streamlined programs:

• Streamlined Foreign Offshore Procedures (SFOP): for expats who meet the nonresidency requirement (same as FEIE's physical presence or bona fide residence test). Penalty: 0%. You file 3 years of amended/original returns and 6 years of FBARs, certify non-willfulness, and pay any unpaid tax plus interest. No FBAR or accuracy-related penalties assessed.⁶
• Streamlined Domestic Offshore Procedures (SDOP): for US residents who don't meet the nonresidency test. Penalty: 5% of the highest year-end aggregate balance of covered foreign financial assets, applied to the same 6-year lookback.

Common Mistakes

• Thinking FBAR is only for "offshore tax shelters." It applies to any US person with a foreign account over $10,000 — that includes your local checking account in the UK, Germany, Australia, or Singapore. Ordinary expat banking triggers it.
• Assuming filing the FBAR covers the Form 8938 obligation. They are separate. High-asset expats with foreign accounts likely owe both.
• Not aggregating accounts for the $10,000 threshold. The threshold is the highest combined value across all foreign accounts at any single point in the year — not year-end balance, not average.
• Missing the automatic FBAR extension. Many expats think they need to request the FBAR extension. They don't — it's automatic to October 15 for everyone. But it doesn't extend beyond October 15.
• Forgetting signature authority accounts. A foreign account you don't own but have signing authority over still counts toward your FBAR threshold.
• Omitting foreign pensions from Form 8938. UK SIPPs, German pension accounts, and similar vehicles may qualify as specified foreign financial assets subject to Form 8938 disclosure (even if the treaty defers the income).
• Using the domestic Form 8938 thresholds when you live abroad. The abroad thresholds ($200K/$300K single; $400K/$600K MFJ) are substantially higher. Many expats mistakenly use the domestic thresholds and over-file, or worse, confuse which category applies to them.

Sources

1. FinCEN — FBAR (FinCEN Form 114) Filing Requirements. 2026 inflation-adjusted penalties: non-willful $16,536 per annual report (per Bittner v. United States, 598 U.S. ___, 2023); willful $165,353 or 50% of account balance. Criminal: up to $250,000 / 5 years, $500,000 / 10 years for aggravated cases.
2. IRS — Report of Foreign Bank and Financial Accounts (FBAR). Filing via BSA E-Filing System; automatic extension to October 15; threshold $10,000 aggregate at any time during the year.
3. IRS — Do I Need to File Form 8938? 2026 thresholds for individuals living abroad: $200,000 year-end / $300,000 any time (single); $400,000/$600,000 (MFJ). Domestic thresholds: $50,000/$75,000 (single); $100,000/$150,000 (MFJ). Thresholds unchanged for 2026 filing season per IRS.
4. IRC § 6038D — Information With Respect to Foreign Financial Assets. Failure-to-disclose penalty $10,000; continued failure up to $50,000; 40% underpayment penalty; 6-year statute of limitations on returns with $5,000+ omission tied to foreign assets.
5. FinCEN — Delinquent FBAR Submission Procedures. Late FBARs with no unreported income may be filed with explanatory statement; generally no penalty assessed for reasonable cause and properly-reported income.
6. IRS — Streamlined Filing Compliance Procedures. SFOP (offshore): 0% penalty, 3 years of returns, 6 years of FBARs; SDOP (domestic): 5% miscellaneous offshore penalty on highest year-end aggregate balance; both require non-willfulness certification.
7. IRS — About Form 8938, Statement of Specified Foreign Financial Assets.

FBAR and Form 8938 requirements interact with your US tax return, foreign pension treatment, and PFIC reporting. Penalty amounts reflect 2026 FinCEN inflation adjustments. Late-filing relief options (streamlined procedures) can reduce or eliminate penalties but require careful execution — consult a specialist before filing amended returns under these programs.