The FBAR Signature Authority Rule: When You File Even Without Ownership

The FBAR (FinCEN 114) is not limited to accounts you own: you must also report any foreign financial account over which you have signature authority, meaning you have the ability to control the account through direct communication with the financial institution, even if you have no financial interest in it. This most commonly comes up when a US employee has signing authority over their employer's foreign bank accounts as part of their job responsibilities, or when a US trustee or executor has authority over a foreign account belonging to a trust or estate. The aggregate $10,000 threshold applies across all accounts you have a financial interest in or signature authority over, so even a single signature-authority account can trigger the filing requirement if its value exceeds that amount at any point in the year. Filing the FBAR to report signature authority does not create a tax liability, since you have no financial interest in the account, but failing to file when required can result in the same substantial penalties as failing to report an account you actually own. If you are unsure whether a particular role at work gives you FBAR-reportable signature authority, the cautious approach is to file and report it.