Foreign Account Reporting: A Complete Guide for American Expats
For American expats living and working abroad, managing international finances comes with unique tax responsibilities. One of the most important — and often misunderstood — obligations is foreign account reporting. Failing to comply can lead to serious penalties, even if no tax is owed. This guide explains what foreign account reporting means, who must file, and how to stay compliant with U.S. regulations. What Is Foreign Account Reporting? Foreign account reporting refers to the requirement for U.S. citizens, green card holders, and certain residents to disclose their overseas financial accounts to the U.S. government. These accounts may include foreign bank accounts, investment accounts, pension funds, or other financial assets held outside the United States. The most common form associated with this requirement is the Report of Foreign Bank and Financial Accounts (FBAR), officially known as FinCEN Form 114. This report is filed separately from your tax return and is submitted electr...