FBAR & FATCA Reporting for Cross-Border Investors

Cross-border investors often focus on visas, business growth, and tax planning but foreign asset reporting is one of the most commonly overlooked and most heavily penalized areas of U.S. tax compliance.

Two U.S. reporting regimes create the most confusion: FBAR and FATCA. While they sound similar, they are governed by different laws, filed with different agencies, and carry severe penalties if ignored.

If you are a cross-border investor, E-2 treaty investor, or a foreign national operating a U.S. business, understanding FBAR and FATCA reporting is critical.

What Is FBAR Reporting?

FBAR stands for Foreign Bank Account Report, officially filed as FinCEN Form 114.

You must file an FBAR if:

• You are a U.S. person for tax purposes, and
• The aggregate value of foreign financial accounts exceeded $10,000 USD at any point during the year

Who Must File FBAR?

• U.S. citizens
• Green card holders
• Foreign nationals meeting the Substantial Presence Test
• Many E-2 visa holders residing in the U.S.

Foreign Accounts That Must Be Reported

• Foreign bank accounts
• Canadian chequing and savings accounts
• TFSA, RRSP, and RESP accounts
• Foreign brokerage and investment accounts
• Corporate accounts with signing authority

FBAR is a disclosure form only, but penalties apply even when no tax is owed.

What Is FATCA Reporting?

FATCA (Foreign Account Tax Compliance Act) reporting is completed on IRS Form 8938 and filed with your U.S. tax return.

Unlike FBAR, FATCA:

• Is enforced by the IRS
• Has higher reporting thresholds
• Includes more asset types

FATCA Reporting Thresholds

• $50,000 for single filers living in the U.S.
• $100,000 for married filing jointly
• Higher thresholds apply for taxpayers living abroad

Assets Reported Under FATCA

• Foreign bank accounts
• Foreign stocks and securities
• Interests in foreign corporations or partnerships
• Foreign pensions and trusts

FBAR vs FATCA: Key Differences

Why Cross-Border Investors Face Higher FBAR & FATCA Risk

Cross-border investors are frequently penalized because:

• Foreign accounts were opened before U.S. residency
• Foreign accountants may not understand U.S. rules
• U.S. CPAs without cross-border expertise overlook reporting
• Canadian accounts feel “normal” and are mistakenly ignored

FBAR & FATCA Penalties

• FBAR penalties up to $10,000 per non-willful violation
• Willful FBAR penalties up to $100,000 or 50% of account value
• FATCA penalties starting at $10,000
• Increased IRS audit risk
• Potential immigration and visa renewal complications

Can You Fix Past FBAR or FATCA Non-Compliance?

Yes, but corrective filings must be handled carefully.

Available disclosure options may include:

• Streamlined Filing Compliance Procedures
• Delinquent FBAR Submission Procedures

Incorrect filings or improper disclosures can increase penalties rather than reduce them.

How FBAR & FATCA Impact E-2 Visa Holders

For E-2 investors, proper tax compliance supports:

• Visa renewals and extensions
• Consular credibility
• Long-term immigration planning

Book a FBAR & FATCA Compliance Consultation

FBAR and FATCA mistakes are expensive but preventable.

At CPA For E-2 Visa, we specialize in:

• FBAR & FATCA compliance for E-2 visa holders
• Canada–U.S. cross-border tax planning
• IRS disclosure and penalty mitigation

Book a Free consultation at +1 832-848-515 for cross-border expertise.

Frequently Asked Questions (FAQs)