Blog post

The Question

Hi Phil,

I’ve been living in Vancouver for about 5 years now — moved from Chicago in 2021 when my husband (Canadian) and I decided to settle on his side of the border. I’m 43, work remotely as a marketing director for a US company (they know I’m in Canada and are fine with it), and I have Canadian PR.

I just found out I was supposed to be filing something called an FBAR. Honestly, I had absolutely no idea this existed until someone posted about it in the Americans in Canada Facebook group last week. I went down a rabbit hole reading about it and now I’m losing sleep over it.

Here’s what I have in Canada: a joint chequing account with my husband at TD (usually about $15K in it), a savings account at EQ Bank with about $45K, an RRSP with about $90K that my employer contributes to, and a TFSA with about $35K — which I’m now reading might be its own separate problem.

On the US side, I still have a checking account at Chase with maybe $5K and a Roth IRA with about $40K from before I moved.

So my Canadian accounts probably total around $185K when the RRSP is included. I’ve been filing my 1040 every year — I use a CPA in Illinois who’s done my returns since before the move — but she’s never once asked me about foreign bank accounts or any form called an FBAR. I feel like I should have been told about this.

Am I in trouble? What kind of penalties are we looking at? Is this the kind of thing where the IRS is going to come after me, or is there a way to fix it quietly?

Thanks,
Stephanie

Phil’s Answer

Hi Stephanie,

Don’t panic — you’re not the first person to discover FBAR requirements a few years late, and there are good options for getting caught up.

Yes, as a US citizen, you’re required to file an FBAR (FinCEN Form 114) every year if the aggregate value of your foreign financial accounts exceeds $10,000 USD at any point during the year. Since you’re living in Canada with $185K+ in Canadian accounts, you’ve been over that threshold since day one.

The FBAR is filed electronically through the BSA E-Filing system — it goes to FinCEN, not the IRS, and it’s separate from your tax return. The deadline is April 15 with an automatic extension to October 15.

Now, here’s the important part about catching up. If your failure to file was non-willful (meaning you simply didn’t know about the requirement, which is clearly your situation), you can likely use the Streamlined Filing Compliance Procedures to get current. Since you live in Canada and likely meet the physical presence test, you’d qualify under the Streamlined Foreign Offshore Procedures, which means:

• 3 years of amended or delinquent tax returns (1040s)
• 6 years of delinquent FBARs
• A certification statement explaining why you didn’t file
• And here’s the best part — no penalty at all if done properly and accepted.

The accounts that go on the FBAR include your TD chequing, EQ savings, RRSP, and TFSA — basically any account you have signature authority over. Your US accounts don’t go on the FBAR since they’re domestic.

You’re right that the TFSA is a separate issue — we should talk about that. But one thing at a time.

And yes, your CPA should have asked about this. It’s a standard question for any US citizen living abroad. You may want to consider working with someone who specializes in cross-border filing going forward.

The worst thing you can do is ignore it now that you know. The penalties for willful non-filing can be up to $100,000 or 50% of the account balance per violation. But for non-willful cases like yours, the path forward is very manageable.

Hope that helps, Stephanie. This is something we handle regularly — happy to help you get squared away.

Regards,
Phil Hogan, CPA, CA
phil@beaconhillwm.ca

Related Articles

• Are You Already a Canadian Citizen? What Bill C-3 Means for Americans With Canadian Roots
• Moving to Canada from the US: A Tax and Investment Planning Checklist

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