FBAR Filing for Minors and Dependents: What Parents Need to Know
2025-08-15 06:10:45
Learn when parents must file FBAR for minors’ foreign accounts to avoid penalties and stay compliant.
Why This Matters for Families Abroad
If you’re a U.S. parent or guardian living overseas, your child’s financial accounts might not be as “off the radar” as you think. Under U.S. law, minors who meet FBAR (Foreign Bank Account Reporting) requirements must have those accounts reported, even if they can’t file on their own. That means the responsibility falls to you.
This guide explains what FBAR is, when minors and dependents need to file, how to handle the process as a parent or guardian, and how to avoid common mistakes. We’ll also cover penalties, provide practical filing tips, and answer some of the most frequent questions from expat families.
What Is the FBAR?
The FBAR — officially FinCEN Form 114 — is a mandatory annual report for U.S. persons with foreign financial accounts exceeding $10,000 in total value at any point during the year.
It’s not part of your regular tax return. Instead, it’s filed electronically with the Financial Crimes Enforcement Network (FinCEN). The rule applies to U.S. citizens, green card holders, and residents, no matter where they live.
Importantly, the law does not exempt minors. If your child’s accounts cross the threshold, the same rules apply.
Who Must File and When
A “U.S. person” includes:
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U.S. citizens (even dual citizens)
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U.S. residents for tax purposes
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Green card holders
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Certain business entities
The FBAR deadline is April 15, with an automatic extension to October 15. Parents or guardians must file on behalf of minors who can’t file independently.
Why Minors’ Accounts Still Require Reporting
Even if a minor doesn’t have direct control over their account, background control counts. This includes:
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Accounts jointly held with a parent
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Accounts where a parent has signature authority
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Education savings accounts in a foreign bank
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Custodial accounts in the child’s name
Example: If a family in Germany sets up a savings account for a 14-year-old with $15,000 in it, that account must be included in the FBAR — even if the child never touches the funds.
How to File FBAR for a Minor or Dependent
The process is similar to filing for yourself, with one key difference: you’re filing as a parent or guardian on their behalf.
Step-by-Step:
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Gather account information — bank name, address, account number, and highest balance during the year.
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Log in to the BSA E-Filing System on the FinCEN website.
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Select “Individual” filer and note that you’re filing for a minor.
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Complete FinCEN Form 114 with the minor’s account details.
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Submit electronically before the deadline.
Common Mistakes Parents Make
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Overlooking small accounts that, combined, push the total over $10,000
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Forgetting about foreign pension or investment accounts in the child’s name
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Reporting only accounts with activity — inactive accounts still count
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Using the wrong year-end exchange rate when converting balances to USD
Penalties for Non-Filing
The penalties for not filing FBAR apply equally to minors. While the IRS may consider intent and circumstances, penalties can still be significant:
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Non-willful: Up to $10,000 per violation (per account, per year)
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Willful: The greater of $100,000 or 50% of the account balance
The IRS also receives foreign account data through agreements like FATCA, so it’s risky to assume unreported accounts will go unnoticed.
Best Practices for Parents and Guardians
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Keep a yearly record of all foreign accounts, even below the threshold — easier to track changes.
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Use the same exchange rate source every year for consistency (IRS provides an annual list).
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Consider professional help if your family has multiple accounts in different countries.
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File as early as possible to avoid last-minute technical issues.
Real-Life Example
Sarah, a U.S. citizen living in Spain, opened an education savings account for her 12-year-old daughter with €13,500 in it. The account had no withdrawals that year. Even though her daughter couldn’t access the funds, Sarah was required to file an FBAR on her behalf. By reporting on time, she avoided penalties and kept her family compliant with U.S. rules.
FAQ
1. Do minors really need to file FBAR?
Yes. If a minor’s accounts exceed the $10,000 threshold, a parent or guardian must file for them.
2. What if my child’s account is only in my name?
If it’s legally your account, you include it in your own FBAR. If it’s in the child’s name, you may need to file for both of you.
3. Does FBAR apply to foreign cryptocurrency wallets?
Currently, FBAR does not cover crypto held in non-financial institutions, but this may change. Check the latest FinCEN updates.
4. Can the IRS penalize a minor?
Yes — though in practice, parents or guardians are responsible for compliance.
5. What if I missed filing for previous years?
You may be eligible for the IRS Streamlined Filing Compliance Procedures to get back on track without harsh penalties.
Key Takeaway
Even though minors can’t legally manage their own finances, the U.S. government still requires reporting of their foreign accounts. By knowing the rules, filing on time, and keeping accurate records, you can avoid penalties and keep your family’s financial reporting in order. As one expat tax advisor put it: “An FBAR isn’t about paying extra taxes — it’s about transparency. The earlier you get compliant, the easier it is.”
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