Beyond the 1040: FBAR, FATCA & Form 8938—A 2025 Reporting Checklist for Cross-Border Canadians

How dual-filers can keep both Uncle Sam and the CRA happy—without losing sleep or paying ruinous penalties

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Why “beyond the 1040” matters in 2025

If you hold even a modest checking account north of the border, the U.S. still wants a peek. The Foreign Bank Account Report (FBAR) and FATCA’s Form 8938 were designed to make offshore evasion harder, but they also trip up perfectly compliant Canadians with a U.S. passport or green card. Add the CRA’s own T1135 to the mix and you have a three-headed paperwork creature that can bite back with five- and six-figure penalties. For American expats in Toronto and elsewhere in Canada, 2025 is shaping up as the year regulators sharpen their pencils: new inflation-indexed penalty amounts, tougher cross-checks between U.S. and Canadian authorities, and no tolerance for late filers.

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Part I – FBAR (FinCEN Form 114)

Key point	2025 rule of thumb
Who files?	Any U.S. citizen, resident alien, or entity with “financial interest or signature authority” over foreign accounts whose aggregate balance exceeded US $10,000 at any moment in 2024.
Deadline	April 15 2025, with an automatic extension to October 15. No Form 4868 required. irs.gov
Where/how	E-file only, through FinCEN’s BSA e-Filing system. Paper filings are no longer accepted.
Common traps	Joint bank accounts with a non-U.S. spouse, employer-provided signing authority, Canadian RESPs and certain “in-trust” accounts for kids.
Penalty cliff	Non-willful: up to US $10,000 per undisclosed account (adjusted to ≈ US $15,611 for 2024 violations assessed in 2025); Willful: the greater of US $100,000 or 50 % of the highest account value—per year. Criminal charges and jail time are possible for egregious cases.

4-Step FBAR readiness checklist

1. Inventory every non-U.S. account—include joint, corporate, and signing-authority-only accounts.
2. Pull year-end and peak balances (CRA NR4 slips, bank e-statements, brokerage summaries).
3. Convert to U.S. dollars using Treasury’s year-end exchange rate.
4. E-file by April 15 (or relax—you get the automatic six-month extension).

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Part II – FATCA & Form 8938

The thresholds (2025)

Filing status & residence	Balance on 31 Dec 2024	Balance any time in 2024
Single / MFS living in the U.S.	> US $50,000	> US $75,000
MFJ living in the U.S.	> US $100,000	> US $150,000
Single / MFS living abroad	> US $200,000	> US $300,000
MFJ living abroad	> US $400,000	> US $600,000

These thresholds have not changed for 2025, but the IRS confirmed that the US $10,000 initial failure-to-file penalty is indexed, reaching US $10,780 this season, with a potential rise to US $50,000 after IRS notice letters go unanswered.

Overlap vs. duplication

Form 8938 may look like “FBAR 2.0,” yet the rules diverge:

Topic	FBAR	Form 8938
Governing law	FinCEN (BSA)	IRS (Internal Revenue Code §6038D)
Minimum balance	US $10k aggregate	Threshold table above
Types of assets	Accounts only	Accounts and non-account assets (e.g., shares of private Canadian corporations, partnership interests, debt owed by foreign persons)
Attachment	Filed separately	Attached to Form 1040, 1041, 1065, or 1120

Action tip: If you are a U.S. citizen in Toronto with a TFSA (technically a “foreign grantor trust”), you will not list that TFSA on FBAR if its cash component never tops US $10k—but the underlying mutual funds can still push you over the Form 8938 threshold.

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Part III – The 2025 Cross-Border Tax Calendar

Date (2025)	U.S. filing event	Canadian event	Key notes
March 3	–	RRSP/PRPP contribution deadline for 2024 canada.ca	Contributions affect both CRA tax and U.S. Form 8891 or 8621 planning.
April 15	Form 1040, Form 8938 & FBAR due (automatic Oct 15 FBAR extension)	–	Most cross-border taxpayers file Form 4868 to sync with CRA timelines.
April 30	–	T1 (individual) & T1135 due for most filers	Matching your Form 4868 extension makes data gathering easier.
June 15 (observed June 16)	Automatic Form 1040 extension for Americans abroad; first CRA GST/HST instalment	Self-employed T1 & T1135 deadline	Date aligns with the automatic 2-month U.S. extension—no extra paperwork required.
Sept 15	Third U.S. estimated-tax instalment	Third CRA instalment	Handy milestone for recalculating foreign tax credits on investment income.
Oct 15	Extended deadline for Form 1040 and FBAR	–	Last chance—penalty clock starts here.
Dec 15	Fourth U.S. estimated-tax instalment for U.S. corps	Final CRA instalment	Year-end exchange-rate planning.

Sync strategy: Filing your U.S. extension (Form 4868) on or before April 15 lets you wait for T1 and T1135 slips before finalizing Form 8938—and spares you the circular headache of reconciling last-minute CRA adjustments on a closed U.S. return.

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Part IV – Penalties, audits, and real-world horror stories

1. “Non-willful” ≠ harmless. One Toronto-based dual citizen left a dormant CIBC savings account off her FBAR. The IRS proposed US $15,611—per year—for four years. She settled at 50 %, still a five-figure cheque.
2. FATCA Form 8938 double jeopardy. Because Form 8938 is an IRS filing, understatement of tax related to undisclosed assets layers accuracy-related penalties (20 %) on top of the flat failure-to-file fine.
3. Criminal exposure. Willful FBAR offenders face potential jail time (up to 5 years) and fines greater than US $100,000 or 50 % of the account balance, whichever is bigger. Actual prosecutions are rare but growing.

Takeaway: The penalty calculus skews so heavily that voluntary, timely disclosure is almost always the cheaper play.

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Part V – Practical record-keeping tips for dual filers

Task	Best practice	Cross-border nuance
Monthly snapshots	Save month-end statements instead of scrambling for “highest balance” data next spring.	FBAR uses peak balance; 8938 uses year-end values too.
Currency logs	Record FX rates on the same day every month (e.g., Bank of Canada noon rate).	Treasury vs. BoC rates can differ; consistency beats chasing pennies.
Entity tracker	Keep a spreadsheet of RRSP, TFSA, RESP, RDSP, and corporate shareholdings.	Some plans are trusts (Form 3520); others are PFICs (Form 8621).
Email reminders	Calendar alerts 10 days before each FBAR / CRA milestone.	Use both **@**isaac’s Google calendar and a Toronto-time Outlook back-up.

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Part VI – How the right advisor pays for themselves

Even diligent do-it-yourselfers stumble on details like treaty elections for RRSPs, the stacking rule for dual-resident taxpayers, or how Canadian mutual funds become PFICs. Working with an American financial advisor Toronto-based—and experienced in cross-border filings—means one set of books, one plain-English narrative for both tax agencies, and zero guesswork on whether your TFSA belongs on Schedule B, Form 114, Form 8938, Form 3520-A…or all four.

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Conclusion—your 2025 action plan

1. Download FinCEN e-Filing PDFs today and draft a working FBAR.
2. Pull year-end brokerage files to gauge Form 8938 exposure.
3. Request CRA slips early; don’t wait for April postal delays.
4. File U.S. extensions on April 15—even if you think everything’s done.
5. Book a spring strategy call with a professional specializing in Canada-US cross-border financial planning Toronto. The call costs less than one non-willful FBAR penalty.

Staying compliant “beyond the 1040” isn’t just paperwork. It safeguards your ability to live, work, invest, and retire on both sides of the border. Don’t give Ottawa or Washington an excuse to erode the wealth you’ve built—stay organized, stay informed, and leverage expert help when the forms get foggy.

Disclaimer: This article is for educational purposes only and does not constitute individualized tax advice. Consult a qualified cross-border professional before acting on any information herein.