Expert US Expat Tax Preparation. Simplified. Resolved. Designed to save you time and money.

This article was first published on June 14, 2012. It was updated on June 11, 2014, with information relevant to the 2013 and 2014 tax years.

If you’ve been following our US Expat Taxes Explained series, you are well aware of your requirement to file a tax return with the IRS each year regardless of where your income is earned, what taxes you pay to other countries, or what currency your earnings are in.  Filing these returns will keep you compliant with the IRS. What many expats are unaware of is their requirement to report foreign bank and financial accounts to the U.S. Department of the Treasury, using a form commonly referred to as the Foreign Bank Account Reporting or FBAR form.

Although many are unaware of the obligation, Americans living abroad are required to file a report of their foreign bank accounts in addition to filing their US expat taxes.  These reports are filed with the US Treasury Department and are done so electronically via FinCEN 114. Paper filings of old Form TD 90-22.1 are no longer accepted.

Allow us to explain the filing requirements, the FBAR, and how to complete the FBAR in order to stay compliant with the US Treasury Department.

FBAR Requirements

American citizens and Green Card holders are required to report their foreign bank accounts if their balances, when added together, are more than $10,000. It does not matter how many accounts this $10,000 is spread across.  You are required to file an FBAR in addition to your US expat taxes if the $10,000 threshold is met by the sum of all your foreign accounts, not just one account with a balance higher than $10,000.

For example, if an expat in the UK has a securities account with a balance of $3,000, a savings account with a balance of $6,000, and a second joint account with their foreign-national, non-resident spouse with a balance of $2,000, and a retirement account with $2,000 in it; all four accounts would need to be reported to the US Treasury Department through Form FinCEN 114.

The same is true for an expat in Spain who has $11,000 in a single Spanish checking account.  They both are required to file, and can both do so with Form FinCEN 114.

FBAR Penalties

If a US citizen or Green Card holder fails to disclose their overseas bank accounts, the treasury department can and will enforce penalties on the taxpayer.  The penalties can be much more severe than the penalties assessed by the IRS for delinquency on US expat taxes.  However, it should be noted that penalties for US Expats who did not know about the requirement to file the FBAR have been forgiven in many cases.

The penalties will depend on the reason for the violation.  The US Treasury Department has both civil and criminal penalties for failure to file.  Generally, the US Treasury Department will only impose one of the penalty types on an individual taxpayer, but it does reserve the right to impose both if it is deemed to be suitable for the specific situation.

The FBAR penalties for not reporting overseas bank accounts are as follows:





The higher penalties are typically reserved for criminal acts in which a citizen is hiding money overseas, but note that they are assessed on a case by case basis.  The IRS does say in the instructions for the FBAR that “If there is a reasonable cause for the failure and the balance in the account is properly reported, no penalty will be imposed.”  Needless to say, it is best to get caught up with delinquent tax returns and FBARs in order to avoid the risk of a change in enforcement in the future.

This blog post has detailed instructions on how to file FBAR electronically.

Need assistance filing FBAR?

If you have any questions about your FBAR filing requirements or need help preparing FinCEN 114, please contact us.

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  • James Smith

    But what if I, a US citizen living outside the US, am married to a foreign national who has no IRS tax ID, no SSN, who has never filed any US taxes, and whose foreign bank accounts are in her name alone (i.e., not a “joint” account)? In that case, assuming I have no accounts in my name nor any joint accounts overseas, it would seem that I as a US citizen am under no obligation to fill out the FBAR or Form 8938, correct?

    Furthermore, if a US citizen has been living outside the us for many years (nearly 20 years, for example) and who each year has been faithful in reporting his income via 1040 and 2555, but not FBAR or 8938 because he did not know of their requirement until recently, what would transpire if he suddenly started filing them on foreign bank accounts he had financial interest in?

    Reading through some posts on this subject in online forums show tales of horror about how US citizen are trying to do the right thing when they learn of filing requirements, only to be hit with huge fines of $10,000 and more. Some US citizens are even revoking their US citizenship over the matter, to ensure they are not hit with fines. It’s quite frightening and sad too seeing that most US citizens living abroad want to do the right thing when it comes to their taxes.

    Thank you.

    • Greenback

      Hello James,

      Thanks for getting in touch, we hope you enjoying the website!

      With regards to your message, if you have no financial accounts (joint or otherwise) that total over 10k, then you do not need to file an FBAR. Please note though that the FBAR is based on the total in all accounts. As such, if you have three accounts with 4K in each, then you will be required to file an FBAR for those three accounts.

      As your wife has no US liability, there is no need for her to file an FBAR.

      As far as getting caught up on your FBAR’s (if you have never filed one before), you would have to file the last six years to be considered up to date. Fortunately, we have caught up hundreds of clients on their FBAR’s and have yet to see any penalties. We have found the Treasury to be very forgiving for those who honestly did not know they had a filing obligation (and have come forward voluntarily).

      I hope this helps! If you have any additional questions, or would like to discuss this further, you may also contact us directly at info(at)

      Tabitha Paddock
      Greenback Customer Champion

  • Greenback Expat Tax Services

    Hello US Tax,

    Thanks for getting in touch, we are glad you are enjoying the site!

    With regards to your message, in a worst case scenario such as that, unfortunately the penalties would be assessed on the 100K as that is the balance of the account.

    The good news is that we have yet to see those type of penalties surface for the everyday expat who simply did not know of their obligation to file.

    I hope this helps!

    Tabitha Paddock

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