The "U.S. Person" Definition
FBAR obligations attach to "U.S. persons," a term that is much broader than "U.S. citizens living in the United States." Under the Bank Secrecy Act regulations, a U.S. person includes:
- U.S. citizens, wherever in the world they live
- Lawful permanent residents ("green card" holders)
- Resident aliens who meet the IRS substantial presence test
- Entities — corporations, partnerships, and LLCs — organized under U.S. law
- Trusts and estates formed under U.S. law
Notice what this means in practice: a U.S. citizen who has lived abroad for decades and never sets foot in the country is still, generally, on the hook for FBAR filing if they meet the account thresholds. Citizenship — not physical residence — is usually the trigger.
Individuals: The Most Common Case
For most individual filers, the test is simple to state even if it takes some digging to answer:
The core individual test
Are you a U.S. citizen, green card holder, or U.S. tax resident, and did the combined maximum value of your foreign financial accounts exceed $10,000 at any point during the year?
If yes to both, an FBAR is generally required — regardless of the source of the funds, whether the account earned interest, or whether you already reported related income elsewhere on your tax return.
Entities: Businesses, Trusts, and Estates
The FBAR requirement doesn't stop at individuals. Domestic entities can have their own independent filing obligation, separate from any obligation their owners or officers might have personally:
| Entity Type | FBAR Relevance |
|---|---|
| U.S. corporations & LLCs | Must file if the entity itself holds qualifying foreign accounts |
| U.S. partnerships | Same entity-level obligation as corporations |
| Trusts formed under U.S. law | Trustee generally files on behalf of the trust; certain beneficiaries and grantors may also have their own filing duty |
| Estates | Executor/administrator may need to file if the estate holds foreign accounts |
Business owners sometimes assume that because the company's accountant handles corporate taxes, FBAR is automatically covered. It often isn't — FBAR filing needs to be affirmatively addressed, ideally as part of year-end compliance planning.
Signature Authority: The Rule People Miss
One of the most overlooked triggers is signature authority — the ability to control the disposition of assets in an account by direct communication with the financial institution, even without any ownership stake in the funds. Common examples include:
- An employee authorized to sign on their employer's foreign bank account
- A company officer with authority over a foreign subsidiary's accounts
- An adult child added as a signer on a parent's foreign account for convenience, with no beneficial ownership
In each case, the person with signature authority may need to file an FBAR even though the money isn't theirs and they never personally benefit from it. There is a limited exception for officers and employees of certain regulated entities with signature authority solely for their employer, but it does not cover everyone.
Joint Accounts and Family Situations
Both owners of a jointly held foreign account generally must each file an FBAR reporting the full value of the account — not half. There is a narrow exception allowing one spouse to file on behalf of both when certain conditions are met and a specific form is submitted, but absent that, each U.S.-person owner files independently.
Notable Exceptions and Edge Cases
A few situations don't trigger a filing requirement, including certain accounts at U.S. military banking facilities, accounts owned by a governmental entity, and accounts owned by an international financial institution of which the U.S. is a member. These carve-outs are narrow — most everyday foreign accounts don't qualify for them.
When in doubt, check the threshold — not the source
Filers sometimes assume inherited money, gift funds, or foreign pension accounts are exempt because they didn't "earn" that money. The FBAR threshold looks at account value, not how the money got there.
Once you've confirmed you're a filer, the next practical question is timing — see our guide to the FBAR filing deadline and how the automatic extension works.