Many forget or get confused about FBAR requirements for Americans abroad. But it’s important to understand that failure to file the FBAR will lead to penalties and attention of the IRS. We have gathered 10 important facts, which you need to know about FBAR reporting.

Our expat tax specialists have helped hundreds of Americans abroad to file their FBAR and we will be happy to help you too! Contact us now at here.

How do an Americans abroad report FBAR on FinCEN Form 114?

On FinCEN Form 114, a taxpayer needs to report foreign financial assets according to the certain requirements. They include but not limited to bank, securities, and financial instruments accounts; mutual funds and you, as the account holder, have an equity interest in the fund; brokerage account, trust, and insurance policies or annuity contracts with a cash value etc.

Filing an FBAR for Americans abroad is required if the total (aggregate) value of all of your financial assets is over $10,000 on any day in the tax year. It is can be a quite confusing situation for taxpayers who they aren’t the main holder of a financial account. Americans abroad mistakingly think they don’t need to disclose the foreign account on FBAR in this case. Well, you need to know that even the nominee must still file the form if the threshold was met.

Example: American abroad has 2 different overseas financial accounts. He has $3,400 in one and $6,600 in another, he must report both accounts on Form 114.

What you do not need to claim on the FBAR: domestic mutual funds that invest in foreign stocks and personal property held directly. Americans in Canada, check out this blog post about tax traps for you.

Read more here.

FREE U.S. tax guide for Americans abroad

FREE U.S. tax guide for Americans abroad

The only e-book about U.S. international taxation, which you need to read as U.S. expat:

1. Foreign Tax Credit vs. Foreign Earned Income Exclusion

2. What is the danger of holding a Controlled Foreign Corporation?

3. Why more and more people are renouncing U.S. citizenship?

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