What is the $10,000 FBAR threshold?

The $10,000 FBAR threshold refers to the aggregate maximum value of all your foreign financial accounts during the calendar year. If the combined value of all your foreign accounts exceeds $10,000 at any point during the year — even for a single day — you are required to file an FBAR for that year.

This threshold is calculated by taking the highest balance in each of your foreign accounts during the year and adding them together. It is important to understand that this is not based on your year-end balance but on the maximum value at any time. For example, if one account peaked at $7,000 in March and another peaked at $4,000 in September, the aggregate is $11,000 and you must file, even if neither account currently holds a significant balance.

The $10,000 threshold applies to the aggregate total, not to individual accounts. A common misconception is that you only need to report accounts with more than $10,000 individually. In reality, even if no single account exceeds $10,000, you must file if the combined maximum values cross the threshold. When you file, you must report all foreign accounts, not just those that pushed you over the threshold.

For accounts denominated in foreign currencies, you convert to US dollars using the Treasury Department's year-end exchange rate (even though you are reporting the maximum value during the year, the year-end rate is used for conversion). The exchange rates are published by the Treasury and are available on the IRS website.

A practical tip: if you have foreign accounts, we recommend tracking your balances regularly throughout the year. Many expats are surprised to discover they cross the threshold due to temporary spikes from incoming transfers, salary deposits, or favorable exchange rate movements. Setting up a simple spreadsheet to track monthly maximum balances in each account can help you determine your FBAR obligation accurately.