As an expat with multiple overseas accounts, you need to know the FBAR maximum penalty so you can protect your assets. FBAR (FinCEN Form 114) is the Treasury Department report you file to disclose foreign bank and financial accounts when your aggregate balance exceeds $10,000 at any point in the year. Missing or late FBAR filings can trigger civil fines from $10,000 up to six figures per violation, plus potential criminal charges. In this guide, you’ll find what FBAR covers, how penalties break down, and steps you can take to stay compliant.
Understanding FBAR reporting
What is FBAR?
FBAR stands for “Report of Foreign Bank and Financial Accounts.” You file FinCEN Form 114 to the U.S. Department of the Treasury, not the IRS. It’s a separate disclosure from your tax return and focuses solely on account balances and ownership.
Who must report
You must file an FBAR if you’re a U.S. person (citizen, resident, or entity) and the combined value of your foreign financial accounts exceeds $10,000 at any time during the calendar year. Accounts include bank accounts, brokerage accounts, mutual funds, and certain insurance policies.
FBAR reporting requirements
You submit FinCEN Form 114 electronically by April 15, with an automatic extension to October 15. To streamline your submission, review our how to file FBAR form guide and details on the FBAR e-filing process.
FBAR vs FATCA
While FBAR is filed with the Treasury, FATCA disclosures go on IRS Form 8938 with your tax return. FATCA thresholds are generally higher and depend on your filing status and where you live. For more on these differences, see FATCA reporting requirements and FATCA reporting threshold.
Exploring penalty types
The IRS imposes different sanctions depending on whether your FBAR violation is non-willful, willful, or criminal. Here’s a quick comparison:
| Violation type | Penalty cap |
|---|---|
| Non-willful | Up to $10,000 per form per year |
| Willful | Greater of $100,000 or 50% of the account balance per year |
| Criminal | Up to $250,000 and/or 5 years’ imprisonment; up to $500,000 and/or 10 years for related crimes |
Non-willful FBAR penalty
If you unintentionally miss a filing, the IRS can impose up to $10,000 per form, per year. The Supreme Court’s decision in Bittner v. United States clarified that this cap applies to each FBAR form rather than each individual account.
Willful FBAR penalty
Willful failures carry a much higher ceiling: the greater of $100,000 or 50% of the account balance at the time of the violation, for each year you didn’t file. Courts often treat reckless disregard as willful behavior.
Criminal FBAR penalties
In severe cases, the Justice Department may pursue criminal charges. You could face fines up to $250,000 and up to five years in prison. If other crimes are involved, fines can reach $500,000 and up to ten years behind bars.
Calculating maximum penalty
Civil penalty caps
- Non-willful: $10,000 per form per year
- Willful: greater of $100,000 or 50% of the balance per year
Annual inflation adjustments
Title 31 of the U.S. Code requires the IRS to adjust civil FBAR penalty maximums each year for inflation. That means the FBAR maximum penalty you face in 2025 may be higher than the 2024 limit.
Reducing your risk
File by deadline
Timely filing is the simplest way to avoid penalties. The FBAR deadline for the 2024 reporting year is April 15, 2025, with an automatic extension to October 15, 2025. Mark your calendar and check our FBAR filing deadline.
Use compliance procedures
If you haven’t been contacted by the IRS, you may qualify for the Streamlined Filing Compliance Procedures or the Delinquent FBAR Submission Procedures. These programs often waive civil penalties or reduce them significantly. Follow the IRS instructions carefully and consult our FBAR filing instructions to get it right.
Show reasonable cause
If you miss a deadline due to circumstances like serious illness, natural disaster, or a genuine misunderstanding, you can request penalty relief by documenting your situation. Provide a clear explanation and supporting records when you file to maximize your chance of a waiver under the reasonable cause standard.
Review key takeaways
- Your FBAR maximum penalty depends on whether you’re non-willful or willful: non-willful caps at $10,000 per form, while willful failures can reach the greater of $100,000 or 50% of your account balance per year.
- Penalty caps adjust yearly with inflation, so always confirm current limits.
- File by April 15 (extended to October 15) to avoid late fees, and explore Streamlined or Delinquent FBAR procedures if you’re behind.
- Document any extenuating circumstances to support a reasonable cause defense.
- Keep detailed records of your foreign accounts and filing dates to stay compliant and minimize your audit risk.
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