FBAR gets most of the attention in expat tax conversations, but Form 8938 is the one that trips up almost as many people, mostly because it sounds like a duplicate of FBAR and isn’t. If you’ve already read our FBAR guide, keep that mental model in the back of your mind you’re going to need it, because the two forms overlap in confusing ways.
Form 8938, tied to FATCA (the Foreign Account Tax Compliance Act), is filed with your regular tax return, not separately like FBAR. And the thresholds are different sometimes a lot different, depending on your filing status and whether you live inside or outside the US.
The Thresholds Nobody Remembers Correctly
This is where I see the most confusion. People assume the FBAR threshold ($10,000) applies here too. It doesn’t.
For a single expat living abroad, the Form 8938 threshold is $200,000 in specified foreign financial assets at year end, or $300,000 at any point during the year. Married filing jointly abroad doubles both numbers. If you’re living in the US, the thresholds drop sharply $50,000 at year-end or $75,000 at any point for a single filer.
That gap matters. Someone might correctly determine they’re under the Form 8938 threshold while still owing an FBAR filing, because $10,000 is a much lower bar to clear.
Does Crypto Count as a Specified Foreign Financial Asset?
This is the part where even professionals disagree a little, but the general consensus leans toward yes for crypto held through a foreign exchange or foreign financial institution. Self custody wallets sit in murkier territory, similar to the FBAR discussion many advisors don’t treat them as reportable under 8938 because there’s no foreign institution acting as custodian, but this isn’t settled with the same clarity as, say, a foreign bank account.
A Side-by-Side to Keep the Two Forms Straight
| FBAR (FinCEN 114) | Form 8938 (FATCA) | |
|---|---|---|
| Filed with | FinCEN, separately from your tax return | Attached to your Form 1040 |
| Threshold (single, living abroad) | $10,000 combined, any point in the year | $200,000 year-end / $300,000 any point |
| Covers self-custody wallets? | Generally no | Generally no, but more debated |
| Covers foreign exchange holdings? | Generally yes | Generally yes |
| Penalty for missing it | Can be severe, starts even without willfulness | Can also be severe, plus statute of limitations issues |
Notice you can owe one, both, or neither, depending entirely on your numbers. They’re not redundant they’re two separate filters with different mesh sizes.
The Statute of Limitations Trap
Here’s something that surprises people: if you’re required to file Form 8938 and you don’t, the IRS can keep your entire tax return open for audit indefinitely for that year not just the crypto related items, everything. That’s a meaningfully bigger consequence than most people realize when they’re deciding whether this form is “worth the hassle.”
What Counts Toward the Threshold
It’s not just crypto. Foreign bank accounts, foreign stock, foreign mutual funds, and certain foreign pensions all get added into the same total. Someone with a modest crypto position might still cross the threshold once everything else is combined, which is why this isn’t really a crypto specific form it’s a broader expat compliance form that crypto happens to fall into.
What I’d Actually Do
If you’re anywhere near these thresholds, don’t try to eyeball it. Get an actual valuation of your foreign assets as of December 31st and check the running high water mark throughout the year. A lot of expats find out later that a single volatile month say, a crypto rally that briefly pushed their exchange balance above $300,000 before dropping back down was enough to trigger the filing requirement, even though it didn’t feel that way looking at their year end balance.
Where This Fits in Your Overall Picture
Form 8938 doesn’t replace FBAR, and neither of them replaces actually reporting your crypto gains and income on your return. Think of it as three separate questions the IRS is asking: Do you have foreign accounts? (FBAR), Do you have significant foreign assets? (8938), and Did you make money from any of it? (your regular income and capital gains reporting). All three can apply to the exact same crypto holdings, and missing any one of them creates its own separate problem.
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