The deadline
Form 8938 is due when your income tax return is due. For most individuals that means April 15, with the same automatic extension to October 15 that applies to your Form 1040 when you file for an extension. There is no separate Form 8938 deadline and no separate extension request — extending your return extends the form.
Americans abroad get the automatic June extension
U.S. citizens and residents whose tax home is abroad generally get an automatic two-month extension to June 15 to file their return — and because Form 8938 travels with the return, that extension covers it too. A further extension to October is available by request.
The penalties
The penalty structure has several layers, and they can apply on top of one another.
Failure-to-file penalty: $10,000
If you fail to file a required Form 8938 (or file an incomplete or inaccurate one), the IRS can impose an initial penalty of $10,000.
Continuation penalty: up to an additional $50,000
If the failure continues after the IRS mails you a notice of it, an additional penalty of $10,000 for each 30-day period (or part of a period) applies, beginning 90 days after the notice — up to a maximum additional $50,000. Combined with the base penalty, a single year's non-filing can reach $60,000.
Accuracy-related penalty: 40%
If you underpay tax because of an undisclosed specified foreign financial asset, the accuracy-related penalty on that understatement is 40% — double the usual 20% rate for ordinary underpayments.
Criminal penalties
In cases involving fraud or willful conduct, criminal penalties can also apply. These are reserved for serious, intentional violations — but they exist.
| Penalty | Amount | When it applies |
|---|---|---|
| Failure to file | $10,000 | Required Form 8938 not filed, or filed incomplete/inaccurate |
| Continuation | +$10,000 per 30 days, max +$50,000 | Failure continues after IRS notice |
| Accuracy-related | 40% of the understatement | Tax underpaid due to an undisclosed asset |
| Fraud / criminal | Varies | Willful or fraudulent conduct |
Reasonable cause
The penalties can be avoided if you can show the failure was due to reasonable cause and not willful neglect. This is a facts-and-circumstances standard — and importantly, the IRS has said that the fact that a foreign country would impose a penalty for disclosing the information is not reasonable cause. Establishing reasonable cause is easier with contemporaneous evidence that you tried to comply, which is one more reason to keep good records.
The statute of limitations can stay open longer
Failing to file Form 8938 (or omitting a specified foreign financial asset) can keep the assessment period for your entire return open. In general:
- If you omit more than $5,000 of income attributable to a specified foreign financial asset, the statute of limitations for that return can extend to six years.
- If you fail to file a required Form 8938 at all, the limitations period for the return generally does not start running (for items related to the asset) until you file the missing form.
In other words, a missing Form 8938 doesn't just risk a penalty — it can leave the door open on the whole year's return for far longer than the usual three years.
If you have unfiled prior years, get advice before acting
The right way to fix past non-compliance depends heavily on your facts — whether the failure was non-willful, how many years are involved, and how much income was affected. The IRS maintains established procedures for coming into compliance, and choosing among them is a decision to make with a qualified tax professional, not from a general web page.
Next steps
- How to File — get the current year filed correctly and on time
- 8 Common Form 8938 Mistakes — the errors that most often lead to penalties
- FAQ — quick answers on late filing, amendments, and more