I Forgot an Old Foreign Account. Do I Need to File an FBAR?
Pat is a software engineer who left Dublin for Singapore and never quite finished packing. He spent four years in Dublin, then took a job in Singapore, where he now lives with his husband, Mark. He moved the way he does everything- with a spreadsheet. The spreadsheet had a tab for his Singapore account, which topped out at $9,800 last year. Pat had checked, and he felt careful.
In February he got on a video call with Ida, the small, silver-haired tax preparer in the brown suit. She had a yellow legal pad. He had the couch and the air conditioning.
“That’s Singapore,” Ida said. “What else is there?”
“Nothing else. I closed Dublin when I left.”
“You closed it.”
“I’m fairly sure I closed it.”
Ida waited. She is good at waiting.
Pat found the old login in his password manager, filed under “Dublin, old,” and typed it in. The page loaded. He scrolled to last year’s statements and read the biggest number aloud, slowly, the way you read a number you did not expect. “Three thousand five hundred euros. And some change.”
Behind the couch, Mark stopped with a mug halfway to his mouth. “You told me you closed that.”
“I thought I had.”
On her side of the screen, Ida wrote two numbers on the pad, added them, and circled the total: $13,647.
Pat scrolled back another year. Dublin had been open then too, and the balance looked about the same. So had Singapore.
He had two roads in front of him. He could decide that a few thousand euros in an account he never touched was not worth a form, and leave it. Or he could find out what he had missed and file.
The story pauses here. Here is what the law actually says.
Short answer: Possibly, yes. An old foreign account counts toward the FBAR whether or not you remember it, as long as it was open at any point in the year, and if the highest balances of all your foreign accounts, added together, passed $10,000 on any day, you file an FBAR (FinCEN Form 114) for that year. Missed years can be filed late.
Do I Have to File an FBAR for a Foreign Account I Forgot About?
Possibly. An account counts if it was open at any point in the calendar year, whether or not you remember it. Add the highest balance of every foreign financial account you own, and you file an FBAR (FinCEN Form 114) if the total was more than $10,000 at any time that year (31 USC §5314; 31 CFR §1010.350). If you moved money from one foreign account to another during the year, count that money once.
An account you closed partway through a year still counts for that year. An account closed in an earlier year does not count for this one. Pat’s Dublin account had never been closed, so it counted in both years.
How Do I Find the Balance of an Old Foreign Account?
Ask the bank for statements for each year you need. The FBAR uses each account’s maximum value for the year, which is the largest balance on any quarterly or more frequent statement. If the account issues no periodic statements, use the largest amount it held at any time that year (IRM 4.26.16.2.2.2). Keep what the bank sends you. The records behind an FBAR must be kept for five years (31 CFR §1010.420).
How Do I Convert Euros or Singapore Dollars to US Dollars?
Convert each account separately, using the Treasury Reporting Rate of Exchange for December 31 of the year you are reporting. Do not use the rate from the day the balance peaked (IRM 4.26.16.2.2.2; Treasury Reporting Rates of Exchange). Then add the results. For Pat, $9,800 from Singapore plus $3,847 from Dublin made $13,647.
Do I Also Need to File Form 8938?
Probably not at these balances. Form 8938 is a separate form filed with your tax return, and its thresholds are much higher. For an unmarried filer who lives outside the US, it applies when specified foreign assets total more than $200,000 on the last day of the year or $300,000 at any time. For joint filers abroad the figures are $400,000 and $600,000 (IRS comparison of Form 8938 and FBAR; IRC §6038D). One form does not replace the other.
What Is the Penalty for Missing an FBAR?
For someone who did not know about an account, the penalty is called non-willful. The statute sets the maximum at $10,000 per report, adjusted upward each year for inflation (31 USC §5321(a)(5); 31 CFR §1010.821). The IRS has discretion to assess less, or nothing. In Bittner v. United States, 598 U.S. 85 (2023), the Supreme Court held that the cap applies once per annual report, not once per account.
Willful violations are a separate category with much higher penalties. Forgetting an account is not the same as hiding one. The IRS’s own manual gives the example of a person who omitted an account by honest oversight and reported all the income from it, and says that person should not be treated as willful without other evidence (IRM 4.26.16.5.5.1).
How Do I File Missed FBARs From Earlier Years?
File each missed year’s FBAR electronically through FinCEN’s BSA E-Filing System, using the instructions for that year. Page one of the form asks why the report is late. Pick the closest reason from the drop-down list, or choose “Other” and explain in the text box, which holds 750 characters. Keep a copy of each filing (IRM 4.26.16.3.11).
The IRS manual tells examiners not to assert a non-willful penalty when the failure was due to reasonable cause and an accurate delinquent FBAR has been filed (IRM 4.26.16.5.4). Whether an explanation counts as reasonable cause depends on the facts. If an old account earned interest that never made it onto a tax return, that income needs to be reported as well, and the right way to catch up may be different.
Pat asked the Dublin bank for statements covering both years, and they arrived as PDFs within the week. He converted each account at the Treasury’s year-end rate and filed two late FBARs in one evening, with a short explanation on page one of each: he had believed the account was closed. The Dublin account was a plain current account that paid no interest, so there was no income to add to his returns. The next morning he closed it and asked the bank for a letter saying so.
Mark asked to see the spreadsheet. It now has a column called Open or Closed, and the Dublin row says Closed, with a date.
The other route. If Pat had left the Dublin account alone, two FBARs would have stayed unfiled, each one open to a penalty if the IRS ever examined them. Ireland and Singapore both have FATCA agreements with the US, so an account like his can come to the IRS’s attention without him filing anything (Treasury FATCA page). Filing first meant he could explain the gap himself.
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The Bottom Line
A US person must file an FBAR (FinCEN Form 114) for any calendar year in which the combined highest balances of all foreign financial accounts exceeded $10,000 at any time, under 31 USC §5314 and 31 CFR §1010.350. An account counts if it was open during the year, whether or not the owner remembered it. Each account’s maximum value comes from its statements and is converted at the Treasury’s year-end exchange rate. The FBAR is filed with FinCEN, separately from the tax return, and is due April 15 with an automatic extension to October 15 (IRM 4.26.16.3.1 and 4.26.16.3.10). Missed years are filed late through the BSA E-Filing System with a statement of why they are late. The non-willful penalty under 31 USC §5321(a)(5) is up to $10,000 per report, adjusted for inflation, and under Bittner v. United States, 598 U.S. 85 (2023), it applies per annual report, not per account. The IRS manual directs examiners not to assert it when the failure was due to reasonable cause and an accurate delinquent FBAR is filed (IRM 4.26.16.5.4).
“An FBAR counts every foreign account that was open during the year, whether or not you remember it.”
Filed under
Foreign Bank Accounts
Renee Mizrahi, EA, CFE
Our founder spent twenty years in U.S. tax practice. But something shifted when her daughters began living abroad permanently: Nepal, Cambodia, Thailand, Israel, France, and a long list of places she has genuinely lost track of.
Pat, Mark, and Ida are fictional characters created to make real tax situations easier to understand. The law in every post is accurate. The people are not. Nothing here is advice for your specific situation.
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