FBAR vs Form 8938: 16 Foreign Holdings Tested, 2026 Rules
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Quick Answer
As of October 22, 2026 there are two separate tests. The FBAR (FinCEN Form 114) is owed when foreign financial accounts add up to more than $10,000 at any time in the calendar year; Form 8938 is owed when specified foreign financial assets pass $50,000 on the last day of the tax year or $75,000 at any time for an unmarried person living in the US ($100,000 and $150,000 if married filing jointly; $200,000 and $300,000 for a single person living abroad; $400,000 and $600,000 for joint filers abroad). The FBAR is filed with FinCEN, due April 15 with an automatic extension to October 15. Form 8938 rides on the income tax return. The two are not the same list: a Luxembourg or Cayman feeder fund is reportable on Form 8938 and is not an FBAR account, and a house abroad in your own name is neither. The penalty ceilings are $16,536 per non-willful FBAR violation (penalties assessed on or after January 17, 2025) and up to $60,000 for one unfiled Form 8938.
Key Takeaways
- The FBAR trigger is $10,000 in aggregate across all foreign accounts at any moment of the calendar year (FinCEN). Two accounts of $6,000 each already trigger it. The same IRS comparison page says Form 8938 uses the last day of the year and an any-time test: $50,000 and $75,000 for an unmarried person in the US.
- A foreign house held in your own name is not reportable on either form. Held through a foreign corporation or partnership, the entity interest is a specified foreign financial asset on Form 8938, and the IRS table says the entity's maximum value includes the real estate. The FBAR still does not apply to the house or the entity.
- A private foreign fund is not an FBAR account today. 31 CFR 1010.350(c)(3)(iv) lists mutual funds that issue shares available to the general public and leaves “Other investment fund” as [Reserved]. The IRS table lists foreign hedge funds and private equity funds as Form 8938 Yes, FBAR No.
- The paperwork that follows the fund is where the cost sits. A feeder organized as a foreign partnership can mean Form 8865 (Category 3 if you contribute more than $100,000 in 12 months, even in cash), and a feeder that is a foreign corporation can be a PFIC (Form 8621), with a $25,000 de minimis exception ($50,000 on a joint return) only if there is no election and no excess distribution.
- Penalty ceilings: $16,536 for a non-willful FBAR violation and $165,353 or 50 percent of the account balance for a willful one (31 CFR 1010.821 and 31 U.S.C. 5321). Form 8938: $10,000 plus up to $50,000 more after IRS notice. The Supreme Court held in Bittner (February 28, 2023) that the non-willful penalty accrues per report, not per account.
- Of the 16 holdings in our matrix, 11 are Form 8938 assets, 7 are FBAR accounts, 6 are both and 3 are neither; the foreign LLC and the foreign pension depend on classification and facts (our count of the table below).
CSV · 97 rows
FBAR and Form 8938 thresholds, penalties and a 16-holding reporting matrix, read from IRS, FinCEN and Treasury sources on October 22, 2026
97 rows: Form 8938 thresholds, FBAR rules, penalty amounts, Form 8621, 8865, 5471 and 1116 thresholds, 48 rows testing 16 foreign holdings, and five worked examples (our arithmetic), each with its source URL.
The two tests side by side
Most pages on this subject are written for expats and compare the two forms in a paragraph. The reader here is different: a US investor with $250,000 or more who owns, or is buying, a home or rental abroad, keeps a bank account for it, or holds a foreign fund through a platform such as Moonfare. For that reader the question is which holding creates which filing, so we start with the rules and then test 16 holdings against them.
| Question | FBAR (FinCEN Form 114) | Form 8938 (IRS) |
|---|---|---|
| Who files | A US person: citizen, resident alien, domestic entity, trust or estate | Specified individuals and certain domestic entities that hold specified foreign financial assets |
| Trigger | Aggregate foreign financial accounts above $10,000 at any time in the calendar year | Specified foreign financial assets above $50,000 on the last day or $75,000 at any time (unmarried, US); $100,000 and $150,000 (joint, US); $200,000 and $300,000 (single, abroad); $400,000 and $600,000 (joint, abroad) |
| What is counted | Bank, securities and other financial accounts at foreign institutions; mutual funds with shares available to the public | Foreign accounts plus foreign non-account investment assets: foreign stock, foreign partnership interests, foreign notes, foreign trust interests, foreign derivatives |
| Where filed | FinCEN BSA E-Filing, not with the tax return | Attached to the income tax return |
| Due | April 15; automatic extension to October 15 | With the return, including extensions |
| Maximum penalty for a non-willful failure | $16,536 per violation (assessed on or after January 17, 2025) | $10,000, plus $10,000 per 30 days after 90 days from IRS notice, capped at $50,000 more |
| Willful failure | The greater of $165,353 or 50 percent of the account balance | No separate willful tier in 26 U.S.C. 6038D(d); criminal exposure is outside this table |
| Exception for US retirement plans | Yes for 401(a), 403(a), 403(b) plans, IRAs and Roth IRAs | US accounts at US institutions are not specified foreign financial assets |
Two details trip people. First, the thresholds are not indexed: the Form 8938 figures in the IRS comparison page (last reviewed September 19, 2026) are the same ones written into Treas. Reg. 1.6038D-2(a), so they are unchanged in the IRS page we read on October 22, 2026. Second, Form 8938 counts the whole asset when it is jointly owned (Treas. Reg. 1.6038D-2(c)(1)), except that a married person filing separately counts one-half of an asset owned with a spouse who is also a specified individual (our reading of paragraph (c)(3)(i)).
One discrepancy we found in the primary sources: the text of 31 CFR 1010.306(c) on the eCFR still says an FBAR is filed “on or before June 30 of each calendar year.” FinCEN and the IRS both state April 15 with an automatic extension to October 15, and we follow them. If you rely on the regulation text alone you will see the wrong date.
Sixteen holdings, tested
The IRS publishes a short table of asset types. We took it, added the regulation text for the holdings it does not cover (a foreign LLC, a Luxembourg feeder, a foreign pension), and added the forms that follow each holding. “Yes” means the holding or the account is reportable on that form when the thresholds above are met.
| Holding | Form 8938 | FBAR | Other forms to check |
|---|---|---|---|
| 1. Account at a foreign bank | Yes | Yes | Schedule B Part III question; interest on Form 1040 |
| 2. Foreign bank account that receives the rent of a foreign rental | Yes | Yes | Schedule E for the rent; Form 1116 if foreign tax is paid |
| 3. Brokerage account at a foreign broker | Yes (the account) | Yes (the account) | Holdings inside may be PFICs (Form 8621) |
| 4. Foreign house in your own name | No | No | Schedule E if rented; gain on sale on Form 1040 |
| 5. Foreign house held through a foreign corporation you own | Yes (the stock) | No, unless the company has a foreign account and you own more than 50 percent | Form 5471 if you own 10 percent or more |
| 6. Foreign house held through a foreign LLC | Depends on the tax classification | No | Form 8832 classification decides; a disregarded LLC means you are treated as owning the house itself |
| 7. Luxembourg feeder fund organized as a partnership (SCSp) | Yes (partnership interest) | No | Form 8865 Category 3 above $100,000 contributed in 12 months; K-1 or equivalent |
| 8. Cayman or other foreign corporate feeder fund | Yes (foreign stock) | No | Form 8621 if the fund is a PFIC |
| 9. Foreign mutual fund held directly | Yes | Yes | Form 8621 if a PFIC |
| 10. Canadian RRSP or similar account at a foreign institution | Yes | Yes (the regulation's retirement exception names only US plans) | Form 8891 was required only through tax years ending on or before December 31, 2013 |
| 11. Interest in a foreign employer pension plan | Yes (Part VI, the plan interest) | Unclear for the underlying accounts | Ask the preparer; there is no FBAR exception for foreign plans in 1010.350(g)(4) |
| 12. Foreign-issued life insurance or annuity with cash value | Yes | Yes | Value is the contract value |
| 13. Foreign stock held directly, not in an account | Yes | No | Form 8621 if a PFIC |
| 14. Account at a foreign branch of a US bank | No | Yes | Ordinary US bank reporting |
| 15. Account at a US branch of a foreign bank | No | No | Ordinary US bank reporting |
| 16. Foreign social security-type benefit rights | No | No | Taxed under the treaty or Form 1040 |
Where the premise usually breaks: the house and the feeder fund
The house. The IRS table says foreign real estate held directly is not a specified foreign financial asset and not an FBAR account. That surprises owners who assume a foreign asset of $400,000 must appear somewhere. It does not appear on Form 8938 or the FBAR, but its rent does appear on Schedule E, and the instructions for Schedule E ask for the property’s city, province or state, country and postal code if it is abroad. The consequence people miss is the account: the bank account that receives the rent or holds the sale proceeds is a foreign financial account, and one account above $10,000 at any time in the year is an FBAR (our reading of the FinCEN trigger).
The holding company. Put the same house in a foreign corporation or a foreign partnership and the reporting moves up one level. Treas. Reg. 1.6038D-2(b)(4)(i) says a person is not treated as having an interest in assets held by a corporation or partnership just because of being a shareholder or partner, so Form 8938 reports the stock or partnership interest, valued at fair market value, and not the building. If you own more than 50 percent of the entity and it has a foreign bank account, you have a financial interest in that account for FBAR purposes (31 CFR 1010.350(e)(2)(ii)). A foreign LLC is the unclear case in our table because its US classification is elective: the Schedule E instructions send you to Form 8832 for the treatment of a foreign LLC, and under Treas. Reg. 1.6038D-2(b)(4)(iii) the owner of a disregarded entity is treated as having an interest in the assets the entity holds.
The feeder fund. A Luxembourg feeder such as the “SCSp” vehicles in the Form D filings we read for our Moonfare review is a foreign partnership interest if it is a partnership for US tax (our reading; the fund’s tax statement says which). Three consequences follow from the sources:
- Form 8938: yes. A capital or profits interest in a foreign partnership, held for investment and not held in a financial account, is on the Form 8938 list of other specified foreign financial assets.
- FBAR: no. The regulation lists mutual funds with shares available to the general public and reserves “Other investment fund.” The IRS table puts foreign hedge funds and private equity funds at No.
- Form 8865: possibly. Category 3 applies to a person who contributed property to a foreign partnership in a 12-month period worth more than $100,000, or ended with at least 10 percent. The Form 8865 instructions note that Category 3 filers can be people who only transferred cash. A $125,000 commitment funded in one year is above that line (our arithmetic on the instructions; ask a preparer whether the fund or its sponsor files on your behalf).
If the feeder is instead a corporation, as in a Cayman structure, the position changes: Form 8938 yes, FBAR no, and Form 8621 if it is a passive foreign investment company, which is a corporation with 75 percent or more passive gross income or at least 50 percent passive assets (Instructions for Form 8621). The de minimis exception in Treas. Reg. 1.1298-1(c) is $25,000 of total PFIC stock at year end, or $50,000 on a joint return, and it only helps if no election applies and there was no excess distribution or gain treated as one.
Platform-level coverage varies, so read the fund’s own tax-document list. In our Moonfare review the tax-document table lists a “K-1 / K-1 Equivalent / PFIC” statement for US investors, which is the document your preparer needs to choose between Form 8865 and Form 8621. Our guide to K-1 and 1099-DIV vehicles lists which US vehicles send which form, and the platform comparison shows which platforms give a US investor an SEC-registered intermediary.
Worked examples (our arithmetic)
| Case | Numbers | Result |
|---|---|---|
| Single retiree living in the US: $40,000 at a foreign bank plus $125,000 in a Luxembourg feeder | Form 8938 total $165,000, above $50,000; foreign accounts $40,000, above $10,000 | Form 8938 and FBAR both. The feeder counts toward Form 8938 only; the account counts toward both |
| Married couple filing jointly in the US: $90,000 in a foreign feeder, rental house abroad in their own names | $90,000 is below the $100,000 joint line; the house counts toward neither form | No Form 8938, no FBAR. Schedule E still reports the rent. A $125,000 contribution would add Form 8865 Category 3 risk |
| Three unfiled FBARs at the non-willful maximum | $16,536 x 3 = $49,608 | A ceiling, not a typical assessment; Bittner makes the unit the report |
| One unfiled Form 8938 that stays unfiled after IRS notice | $10,000 + $50,000 | $60,000 maximum, the figure the IRS comparison page gives |
| FBAR for calendar 2026 | April 15, 2027, extended to October 15, 2027 | No extension request needed (IRS FBAR page) |
What a reader can do with this
- List every foreign item once, with its holder. Account, fund, entity, pension and policy. Mark each as an account or a non-account asset, then add the highest balance of the year for the accounts and the year-end value for everything else. The FBAR uses the aggregate of accounts; Form 8938 adds the non-account assets.
- Test both thresholds separately. An account of $12,000 alone is an FBAR and not a Form 8938. A $60,000 foreign fund alone is a Form 8938 for an unmarried person in the US (above $50,000 at year end) and not an FBAR.
- Ask the fund or platform in writing whether the vehicle is a partnership, a corporation or disregarded for US tax, whether it expects to issue a K-1, a K-1 equivalent or a PFIC statement, and who files Form 8865 if it applies. Keep the answer with your records.
- Count the paperwork already filed. An asset reported in full on Forms 3520, 3520-A, 5471, 8621 or 8865 is not repeated on Form 8938 but still counts toward the threshold (Treas. Reg. 1.6038D-7(a)); Form 8938 then shows only that the other form was filed.
- If you missed years, the IRS says that anyone not contacted about a late FBAR and not under investigation should file as soon as possible to minimize potential penalties. Reasonable cause is a defense for Form 8938 (26 U.S.C. 6038D(g)); a foreign law that bars disclosure is not.
- Before the sale of a foreign property, read capital gains on real estate for the US side. If you are buying US property from a foreign seller, see FIRPTA withholding. A foreign national financing a US property is a separate case: foreign-national DSCR loans.
This is analysis of public documents, not investment, legal or tax advice.
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FAQ
Sources, read and saved on October 22, 2026: FinCEN, Report Foreign Bank and Financial Accounts; IRS, Report of Foreign Bank and Financial Accounts (FBAR) and Comparison of Form 8938 and FBAR requirements (last reviewed September 19, 2026); Instructions for Form 8938 (11/2021); Instructions for Forms 8865 (2025), 8621 (12/2025), 5471 (12/2025) and 1116, and for Schedule E and Form 1040 (2025); 31 CFR 1010.306, 1010.350 and 1010.821 (eCFR); Treas. Reg. 1.6038D-2, 1.6038D-3, 1.6038D-7 and 1.1298-1 (eCFR); 26 U.S.C. 6038D and 31 U.S.C. 5321 (Cornell Legal Information Institute); Bittner v. United States, No. 21-1195 (Supreme Court, February 28, 2023).
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