Sometimes the biggest hurdle in starting your tax preparation is simply the effort required to gather all your documents, particularly for FBAR and Form 8938 reporting, which depends on having complete and accurate financial records. Breaking the process into small, manageable steps can make it far less overwhelming. 

Why This Matters

FBAR and Form 8938 filings carry significant penalties for errors or omissions. Taking a few proactive steps now can help ensure accurate reporting, smoother tax preparation, and greater peace of mind.

Don’t wait! Get prepared today.

Now is the ideal time to download your bank and investment statements. Many financial institutions only make the prior 12 months available, which means waiting can turn a simple task into a frustrating one.

If you are required to file FBARs and / or Form 8938 to report foreign financial assets, this step is especially important.

Who is required to file FBAR?

You are generally required to file an FBAR (FinCEN Form 114) if:

• You are a U.S. person (U.S. citizen, resident, or certain entities), and
• You had a financial interest in or signature authority over one or more foreign financial accounts, and
• The aggregate value of those accounts exceeded $10,000 at any time during the calendar year

Foreign accounts may include bank accounts, investment accounts, certain retirement accounts, and other financial accounts held outside the United States.

Who is required to file Form 8938?

U.S. taxpayers may be required to file Form 8938 (Statement of Specified Foreign Financial Assets) if their specified foreign financial assets exceed applicable thresholds, which vary by filing status and residency.

Form 8938 is filed with your federal income tax return and applies to a broad range of foreign financial assets, including foreign bank accounts, investment accounts, foreign stocks held outside a U.S. account, and certain foreign interests.

Filing Tips

Pro tip: Instead of combing through monthly statements to find the highest account balance, check whether your bank allows you to select the entire year as a date range and export the data to a .csv file, such as Excel.

Once downloaded:

• Open the file
• Turn on the filter feature in the column headers
• Use the dropdown to quickly identify the highest balance for the year

A few minutes now can save hours later, and your future self will thank you.

Accurate and timely filing is critical because penalties can apply even when no tax is owed.