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Do I report a European pension on the FBAR?

Updated

Checked against official sources on How we check

Short answer

Individual pension accounts in your name are normally reportable, but the answer for collective workplace pension funds is unsettled.⁠Source 1

The IRS calls foreign retirement plans "normally reportable" and limits the retirement-plan exception to U.S. plans. Neither FinCEN nor the IRS has addressed collective European workplace funds.⁠Source 1⁠Source 2

Ask one question of each pension: is there an account in your name holding assets, or only a promise of future benefits?

What is known and what is open

What is known
  • The FBAR retirement-plan exception covers U.S. plans and IRAs only. It does not cover any European plan.⁠Source 2⁠Source 1
  • The IRS says foreign plans are normally reportable, naming the Canadian RRSP and Mexican AFORE accounts. A personal pension account at a European bank, insurer or fund manager is the closest match.⁠Source 1
  • State pensions and other social security-type benefits are not reported on the FBAR or on Form 8938. The bank account they are paid into is.⁠Source 3
  • Withdrawal limits until retirement do not create an exception.⁠Source 2
What is open
In a collective or trust-based workplace fund, the fund owns the assets and you hold a right to future payments, even when a personal balance is shown. No guidance says whether that right is a financial account. FinCEN's 2011 explanation points such participants to the more-than-50% ownership tests.⁠Source 4
What to keep
Keep each year's pension statement and the plan's description of how assets are held. Record which approach you took and why.⁠Source 1⁠Source 5

Example

Example

Laura in Basel

Laura has a personal retirement savings account at a Swiss bank, in her own name, that peaked at CHF 30,000. She is also a member of her employer's pension fund.⁠Source 1

She reports the personal account, converted at the December 31 Treasury rate for francs. For the employer fund, she keeps the yearly statement and records how she decided, since no guidance covers it.⁠Source 1⁠Source 6

Common mistake

Treating every pension as exempt because it is for retirement. Only U.S. plans have an FBAR exception.⁠Source 2⁠Source 1

More on this question

Is a UK SIPP reportable?

Normally yes. A SIPP is a personal pension with its own balance, the closest UK match to the RRSP the IRS names as normally reportable.⁠Source 1

Does a reportable pension count toward the $10,000?

Yes. It adds its highest value to your other foreign accounts.⁠Source 7

Is my European state pension reportable?

No. Social security-type benefits are not accounts. The bank account receiving the payments is reported as usual.⁠Source 3

Related questions

Full rules and more examples: Foreign pensions and the FBAR

Sources

Official sources used for this page.

  1. Source 1: IRS, Internal Revenue Manual 4.26.16 — FBAR (opens in a new tab)

    Financial interests, signature authority, U.S. residency (including 6013(g)/(h) elections and treaties), family attribution, spousal filing, Form 114a parts and amended-FBAR identifiers.

    irs.govChecked Source updated Back to text

  2. Source 2: eCFR, 31 CFR § 1010.350 — Reports of foreign financial accounts (opens in a new tab)

    Who has a reportable financial interest in accounts, the rule for owners of record and the definition of signature authority.

    ecfr.govChecked Back to text

  3. Source 3: IRS, Comparison of Form 8938 and FBAR requirements (opens in a new tab)

    Side-by-side rules for Form 8938 and the FBAR.

    irs.govChecked Back to text

  4. Source 4: Federal Register, 76 FR 10234 — Final rule on reports of foreign financial accounts (2011) (opens in a new tab)

    FinCEN's explanation of financial interest, trusts and signature authority.

    federalregister.govChecked Source updated Back to text

  5. Source 5: FinCEN, Record Keeping (opens in a new tab)

    Records each filer must keep and the employee exception.

    fincen.govChecked Back to text

  6. Source 6: FinCEN, Reporting Maximum Account Value (opens in a new tab)

    Maximum account value for cash and nonmonetary assets, account-by-account values and currency conversion, including another verifiable rate with its source.

    fincen.govChecked Back to text

  7. Source 7: IRS, Report of Foreign Bank and Financial Accounts (FBAR) (opens in a new tab)

    U.S.-person and $10,000 tests, spousal exception, irrelevance of income-tax filing status and extensions for certain employees and officers.

    irs.govChecked Back to text