2026 Offshore Account Disclosure Compliance Guide

Under federal law, U.S. taxpayers, whether residing in the U.S. or abroad, are required to disclose their offshore accounts to the federal government annually. While there are minimum account value thresholds, these thresholds will be easily surpassed in most cases. In this article, Texas international tax attorney Lawrence Brown provides an overview of what taxpayers need to know about offshore account disclosure compliance in 2026.

Understanding the Sources of U.S. Taxpayers’ Offshore Account Disclosure Obligations

Two federal laws establish offshore account disclosure requirements for U.S. taxpayers. Taxpayers who own and control offshore accounts must assess their obligation to comply with each of these laws separately, as each has its own separate annual filing requirements. The federal laws that establish U.S. taxpayers’ offshore account disclosure obligations are:

• Bank Secrecy Act (BSA) – The Bank Secrecy Act (BSA) establishes disclosure requirements for U.S. taxpayers and financial institutions in the U.S. and abroad. Under the BSA, taxpayers who own or control qualifying “foreign financial accounts” must disclose these accounts using the Report of Foreign Bank and Financial Accounts (FBAR).
• Foreign Account Tax Compliance Act (FATCA) – The Foreign Account Tax Compliance Act (FATCA) establishes disclosure requirements that pertain to U.S. taxpayers’ “foreign financial assets.” These include, but are not limited to, offshore accounts. To comply with FATCA, taxpayers must file Form 8938 with the Internal Revenue Service (IRS).

In many cases, U.S. taxpayers will need to comply with both the BSA and FATCA annually. As discussed in greater detail below, failure to comply with either statute can expose taxpayers to significant penalties, including criminal penalties in some cases.

BSA (FBAR) Compliance

U.S. taxpayers must comply with the BSA in 2026 if the aggregate value of their foreign financial accounts exceeds $10,000 at any time during the calendar year. This means that if any one or more of a taxpayer’s foreign financial accounts exceeded $10,000 in value at any point in 2025, then the taxpayer must report all of the taxpayer’s foreign financial accounts on an FBAR in 2026.

When filing FBARs, taxpayers must report the “[m]aximum value of financial accounts maintained by a financial institution physically located in a foreign country.” This applies to all accounts in which a taxpayer has a financial interest or signature authority, which are defined as follows:

• “Financial Interest” – “[Y]ou are the owner of record or holder of legal title; the owner of record or holder of legal title is your agent or representative; you have a sufficient interest in the entity that is the owner of record or holder of legal title.”
• “Signature Authority” – “[Y]ou have authority to control the disposition of the assets in the account by direct communication with the financial institution maintaining the account.”

Taxpayers must file their FBARs with the Financial Crimes Enforcement Network (FinCEN) through its BSA E-Filing System. FBARs are technically due by April 15, but all taxpayers receive an automatic six-month extension.

FATCA (Form 8938) Compliance

U.S. taxpayers must comply with FATCA in 2026 if the aggregate value of their “foreign financial assets” exceeds the applicable statutory threshold stated below. Foreign financial assets include “foreign financial accounts and foreign non-account assets held for investment (as opposed to held for use in a trade or business), such as foreign stock and securities, foreign financial instruments, contracts with non-U.S. persons, and interests in foreign entities.” For 2026, the filing thresholds under FATCA are as follows:

• Living in the U.S. and Filing Individually (or Filing Separately if Married) – Total value of foreign financial assets was more than $50,000 on the last day of the tax year or more than $75,000 at any time during the tax year.
• Living in the U.S. and Filing Jointly – Total value of foreign financial assets was more than $100,000 on the last day of the tax year or more than $150,000 at any time during the tax year.
• Living Outside of the U.S. and Filing Individually (or Filing Separately if Married) – Total value of foreign financial assets was more than $200,000 on the last day of the tax year or more than $300,000 at any time during the tax year.
• Living Outside of the U.S. and Filing Jointly – Total value of foreign financial assets was more than $200,000 on the last day of the tax year or more than $400,000 at any time during the tax year.
• Domestic Entities – Total value of foreign financial assets was more than $50,000 on the last day of the tax year or more than $75,000 at any time during the tax year.

Form 8938 is due when taxpayers file their annual income tax return with the IRS. Unlike the FBAR filing deadline, the Form 8938 filing deadline is not subject to an automatic extension.

Consequences of Noncompliance for U.S. Taxpayers with Offshore Accounts

Under both the BSA and FATCA, taxpayers who fail to meet their offshore account disclosure obligations can face steep penalties. Civil penalties apply to non-willful violations, while allegations of willfully failing to file an FBAR or Form 8938 can lead to federal criminal charges.

Options for U.S. Taxpayers Who Are Behind on Their Offshore Account Disclosures

With all of this in mind, what can (and should) taxpayers do if they did not file an FBAR or Form 8938 in 2025? In this scenario, there are two primary options for avoiding federal scrutiny. In cases involving non-willful violations, taxpayers may be eligible to submit a streamlined filing to the IRS. In cases involving willful violations, taxpayers may need to submit a voluntary disclosure to IRS Criminal Investigation (IRS CI) instead.

Request a Confidential Consultation with Texas International Tax Attorney Lawrence Brown

If you have questions or concerns about offshore account disclosure compliance as we head into 2026, please get in touch. We represent high-income and high-net-worth taxpayers in the U.S. and abroad in high-stakes federal tax matters. To request a confidential consultation with Texas international tax attorney Lawrence Brown, please call 888-870-0025 or tell us how we can reach you online today.