Form 8938 and the FBAR Side by Side: Thresholds, What Each Counts, and Why Most Americans in Canada File Both

Short version: Form 8938 Explained: FATCA Foreign Asset Reporting

The two foreign-asset forms are the most duplicated and most confused pair in an American-in-Canada's annual package, and the confusion has a simple root: they were written by different agencies for different purposes and never reconciled. The FBAR (FinCEN Form 114): a Bank Secrecy Act filing to the Treasury's Financial Crimes Enforcement Network, required when the aggregate maximum value of all foreign financial accounts in which the filer has a financial interest or over which they have signature authority exceeds US$10,000 at any time during the calendar year; filed electronically through FinCEN's system, separately from the tax return, due April 15 with an automatic extension to October 15; reporting each account's maximum value during the year; and carrying its own penalty regime (the non-willful per-violation penalty, the willful penalty up to 50% of the balance) under Title 31, with a six-year statute. Form 8938 (Statement of Specified Foreign Financial Assets): a tax-code filing attached to the Form 1040, required when specified foreign financial assets exceed thresholds that depend on residence and filing status — for taxpayers living abroad, US$200,000 at year-end or US$300,000 at any time (single) and US$400,000/US$600,000 (joint); for those living in the US, US$50,000/US$75,000 (single) and US$100,000/US$150,000 (joint) — reporting each asset's maximum value and, distinctively, the income each asset produced and where on the return it appears; carrying a US$10,000 penalty for non-filing (escalating after notice) under Title 26, and — the feature that matters most for catch-up — holding the entire return's assessment statute open until it is filed. What each counts, where they diverge: the FBAR covers financial accounts (bank, brokerage, registered plans, insurance policies with cash value, and accounts over which you have signature authority — the corporate account you can sign on, your parent's account under a power of attorney, a joint account with a non-US spouse at its full value) but not directly held assets that aren't accounts. Form 8938 covers financial accounts held with foreign institutions plus other specified foreign financial assets not held in an account — stock or securities issued by a foreign person held directly (shares in a private Canadian corporation), interests in foreign entities and trusts, foreign-issued financial instruments and contracts — but not accounts over which you merely have signature authority without a financial interest, and not foreign real estate or currency held directly. The practical overlaps and gaps for Canadians: the RRSP, TFSA, RESP, and Canadian brokerage accounts go on both; the corporate account you sign on goes on the FBAR only; your private Canadian company's shares go on 8938 only (and often on Form 5471 as well, which relieves the 8938 duplication for assets reported there — the form's own duplication rules exempt assets reported on 3520, 5471, 8621, and similar forms, though the value still counts toward the threshold); Canadian mutual funds in a taxable account go on both and on Form 8621; a Canadian pension plan interest generally goes on 8938 with a valuation convention; the Canadian house goes on neither. The routine that files both correctly: one account-and-asset inventory built each January (every account, every holding, every entity interest, every signature authority), each item tagged for FBAR (yes/no), 8938 (yes/no), and other forms; maximum values pulled from statements and converted at the Treasury year-end rate (FBAR) and the appropriate rate (8938 accepts year-end for most assets); the FBAR filed through FinCEN by October 15 at the latest with its confirmation saved; Form 8938 attached to the return with its income cross-references completed. The catch-up implication closes it: a missing FBAR is fixed through the delinquent FBAR procedures or streamlined; a missing 8938 holds the whole year open until filed and is fixed through the delinquent information return procedures or streamlined — which is why catch-up inventories run both forms for every year, and why "I filed the FBAR" is never a complete answer to the 8938 question.

Key takeaways

• Two agencies, two thresholds: FBAR to FinCEN at US$10,000 aggregate maximum value of accounts; Form 8938 to the IRS at US$200,000/US$300,000 single and US$400,000/US$600,000 joint for filers abroad (far lower for US residents), on specified foreign financial assets.
• Filing one never satisfies the other: different forms, different systems, different deadlines (FBAR separately by October 15 at the latest; 8938 with the return), different penalties and statutes.
• Asset scope diverges: signature-authority accounts are FBAR-only; directly held foreign shares, entity interests, and trust interests are 8938-only; registered plans and brokerage accounts are both; real estate is neither.
• 8938's duplication relief: assets reported on 3520, 5471, 8621 and similar forms are noted rather than re-detailed on 8938 — but their values still count toward the threshold.
• The statute feature: a missing 8938 holds the entire year's return open; a missing FBAR runs its own six-year clock — catch-up inventories run both for every year.
• One inventory, two tags: build the January asset list once, tag each item FBAR/8938/other, pull maximum values, convert, file both — the routine that makes the pair boring.

The January inventory

Columns: asset or account; institution; type; ownership (own, joint, signature-only); maximum value in the year (statements); year-end value; currency and conversion; FBAR (Y/N); 8938 (Y/N); other form (8621, 5471, 3520, none); income produced and where on the return it appears. Rows: everything — every account including registered plans and the one with C$400 in it, every directly held security, every entity or trust interest, every account you can sign on. Total the FBAR column's maximums against US$10,000 and the 8938 column's values against your threshold. File accordingly, save the FBAR confirmation, attach the 8938. Ninety minutes a year, and the pair never generates a penalty.

Worked example

A dual-citizen physician in Winnipeg, married to a Canadian, builds the January inventory. FBAR column: her RRSP (C$480,000), TFSA (C$95,000), taxable brokerage (C$220,000), chequing (C$14,000), the joint savings account with her husband (C$60,000, full value), and her medical corporation's operating account over which she has signature authority (C$130,000) — aggregate far over US$10,000; six accounts on the FBAR at their maximum values. 8938 column: RRSP, TFSA, taxable brokerage, chequing, and the joint account (her financial interest) — the corporation's account drops off (signature authority only), but her shares in the medical corporation come on as a directly held foreign security, noted as reported on Form 5471 rather than detailed; the two Canadian equity funds in her taxable account are noted as reported on Form 8621. Threshold: well above the joint-abroad line; 8938 filed with the return, income cross-references completed for each asset. Her husband, a Canadian with no US status, files nothing American — but his half of the joint account still appears at full value on her FBAR, which the couple understood only because the inventory's ownership column made them ask. Two forms, one inventory, ninety minutes — and the year's foreign-asset reporting is done before the return is started.

Official sources

Form 8938 reporting is "in addition to the long-standing requirement to report foreign financial accounts on FinCEN Form 114 (FBAR)," and "if you reported specified foreign financial assets on other forms" — such as Forms 3520, 3520-A, 5471, 8621, or 8865 — "you do not have to report them a second time on Form 8938." — Internal Revenue Service, Summary of FATCA reporting for U.S. taxpayers, https://www.irs.gov/businesses/corporations/summary-of-fatca-reporting-for-us-taxpayers

A U.S. person must file an FBAR "if the aggregate value of those foreign financial accounts exceeded $10,000 at any time during the calendar year reported"; it is filed electronically through FinCEN's BSA E-Filing System, and "you're allowed an automatic extension to October 15 if you fail to meet the FBAR annual due date of April 15." — Internal Revenue Service, Report of Foreign Bank and Financial Accounts (FBAR), https://www.irs.gov/businesses/small-businesses-self-employed/report-of-foreign-bank-and-financial-accounts-fbar

Practitioner note

The FBAR and Form 8938 are the most duplicated pair in an expat's package and the most commonly half-done — the FBAR filed, the 8938 forgotten, the year held open. Our January inventory tags every account and asset for both forms in one pass, catches the divergences (signature-authority accounts, directly held shares, joint accounts at full value), and files both with confirmations saved — because in catch-up work the missing 8938 is the form that keeps old years alive, and in annual work it is the form that shouldn't take a second thought.

See also: Browse every cross-border tax topic guide, organized by situation.

Next step

Fairlight prepares the annual foreign-asset reporting routine — the tagged January inventory, maximum-value and conversion workpapers, FBAR filing with confirmation, and Form 8938 with duplication references and income cross-references. See cross-border pricing or book a call.