FBAR vs 8938

Comparison of Form 8938 and FBAR Requirements

The new Form 8938 filing requirement does not replace or otherwise affect a taxpayer’s obligation to file Form TD F 90-22.1 (Report of Foreign Bank and Financial Accounts). Individuals must file each form for which they meet the relevant reporting threshold.


Form 8938, Statement of Specified Foreign Financial Assets Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts (FBAR)
Who Must File? Specified individuals, which include U.S citizens, resident aliens, and certain non-resident aliens that have an interest in specified foreign financial assets and meet the reporting threshold U.S. persons, which include U.S. citizens, resident aliens, trusts, estates, and domestic entities that have an interest in foreign financial accounts and meet the reporting threshold
Does the United States include U.S. territories? No Yes, resident aliens of U.S territories and U.S. territory entities are subject to FBAR reporting
Reporting Threshold (Total Value of Assets) $50,000 on the last day of the tax year or $75,000 at any time during the tax year (higher threshold amounts apply to married individuals filing jointly and individuals living abroad) $10,000 at any time during the calendar year
When do you have an interest in an account or asset? If any income, gains, losses, deductions, credits, gross proceeds, or distributions from holding or disposing of the account or asset are or would be required to be reported, included, or otherwise reflected on your income tax return Financial interest: you are the owner of record or holder of legal title; the owner of record or holder of legal title is your agent or representative; you have a sufficient interest in the entity that is the owner of record or holder of legal title.Signature authority: you have authority to control the disposition of the assets in the account by direct communication with the financial institution maintaining the account.See instructions for further details.
What is Reported? Maximum value of specified foreign financial assets, which include financial accounts with foreign financial institutions and certain other foreign non-account investment assets Maximum value of financial accounts maintained by a financial institution physically located in a foreign country
How are maximum account or asset values determined and reported? Fair market value in U.S. dollars in accord with the Form 8938 instructions for each account and asset reportedConvert to U.S. dollars using the end of the taxable year exchange rate and report in U.S. dollars. Use periodic account statements to determine the maximum value in the currency of the account.Convert to U.S. dollars using the end of the calendar year exchange rate and report in U.S. dollars.
When Due? By due date, including extension, if any, for income tax return Received by June 30 (no extensions of time granted)
Where to File? File with income tax return pursuant to instructions for filing the return Mail to:Department of the Treasury
Post Office Box 32621
Detroit, MI 48232-0621For express mail to:IRS Enterprise Computing Center
ATTN: CTR Operations
Mailroom, 4th Floor
985 Michigan Avenue
Detroit, MI 48226

Certain individuals may file electronically at BSA E-Filing SystemPenaltiesUp to $10,000 for failure to disclose and an additional $10,000 for each 30 days of non-filing after IRS notice of a failure to disclose, for a potential maximum penalty of $60,000; criminal penalties may also applyIf non-willful, up to $10,000; if willful, up to the greater of $100,000 or 50 percent of account balances; criminal penalties may also apply

Types of Foreign Assets and Whether They are Reportable

Financial (deposit and custodial) accounts held at foreign financial institutionsYesYesFinancial account held at a foreign branch of a U.S. financial institutionNoYesFinancial account held at a U.S. branch of a foreign financial institutionNoNoForeign financial account for which you have signature authorityNo, unless you otherwise have an interest in the account as described aboveYes, subject to exceptionsForeign stock or securities held in a financial account at a foreign financial institutionThe account itself is subject to reporting, but the contents of the account do not have to be separately reportedThe account itself is subject to reporting, but the contents of the account do not have to be separately reportedForeign stock or securities not held in a financial accountYesNoForeign partnership interestsYesNoIndirect interests in foreign financial assets through an entityNoYes, if sufficient ownership or beneficial interest (i.e., a greater than 50 percent interest) in the entity. See instructions for further detail.Foreign mutual fundsYesYesDomestic mutual fund investing in foreign stocks and securitiesNoNoForeign accounts and foreign non-account investment assets held by foreign or domestic grantor trust for which you are the grantorYes, as to both foreign accounts and foreign non-account investment assetsYes, as to foreign accountsForeign-issued life insurance or annuity contract with a cash-valueYesYesForeign hedge funds and foreign private equity fundsYesNoForeign real estate held directlyNoNoForeign real estate held through a foreign entityNo, but the foreign entity itself is a specified foreign financial asset and its maximum value includes the value of the real estateNoForeign currency held directlyNoNoPrecious Metals held directlyNoNoPersonal property, held directly, such as art, antiques, jewelry, cars and other collectiblesNoNo‘Social Security’- type program benefits provided by a foreign governmentNoNo


Source: http://www.irs.gov/Businesses/Comparison-of-Form-8938-and-FBAR-Requirements