FBAR Maximum Account Value: How to Calculate It Correctly

The FBAR maximum account value is the highest balance a foreign financial account reached at any point during the calendar year, not its December 31 balance. You find the peak in the account's own currency, convert it to US dollars at the Treasury Reporting Rate of Exchange for the last day of that year, and round up to the next whole dollar.

Every US person with foreign accounts totalling more than $10,000 at any time in the year must file FinCEN Form 114, the Report of Foreign Bank and Financial Accounts (FBAR). The form asks one figure for each account: its maximum value. That single number causes more questions than any other box, especially for Americans holding sterling accounts in the UK or dirham accounts in the UAE. This guide shows how to calculate it correctly and consistently.

What the FBAR maximum account value means

FinCEN defines the maximum value as a reasonable approximation of the greatest value of the account during the calendar year. In practice, that is the highest daily balance. The FinCEN guidance on reporting maximum account value allows you to rely on periodic account statements, provided they fairly reflect the peak.

Why the closing balance is the wrong figure

Many first-time filers copy the December 31 balance from the year-end statement. That is usually wrong. For example, a salary account that receives a £9,000 bonus in March and is spent down by April will show a far higher peak than its closing balance. Consequently, the March peak is the figure FinCEN wants. Under-reporting the maximum is a reporting error, even if you filed on time.

Statements versus daily balances

You do not need to reconstruct every daily balance. Monthly statements are acceptable if they reasonably show the highest value. However, if you know a large deposit passed through the account between statement dates, you should use the higher intra-month figure. Online banking downloads make this quick for most UK and UAE banks.

Which exchange rate to use

The exchange rate rule is strict. You convert each account's maximum value using the Treasury Reporting Rates of Exchange for the last day of the calendar year, published by the US Department of the Treasury's Bureau of the Fiscal Service. You use that December 31 rate even if the account peaked in March. You do not use the spot rate on the peak date, the IRS yearly average rate or your bank's rate. The Treasury Reporting Rates of Exchange dataset lists the official rates by currency.

When no Treasury rate exists

If the Treasury does not publish a rate for a currency, use another verifiable exchange rate and state its source on the FBAR. This is rare for sterling and dirhams, which both have published Treasury rates.

Rounding and negative balances

Record every amount in US dollars, rounded up to the next whole dollar. For instance, $15,265.25 becomes $15,266. If an account had a negative balance all year, such as an overdrawn account, report the maximum value as zero. The account must still be listed.

Our comparison of FBAR versus Form 8938 explains the threshold differences in full.

FBAR maximum account value examples for UK and UAE accounts

The examples below are illustrative. Always use the published Treasury rate for the year you are reporting.

A UK current account in sterling

Consider an American in Manchester whose high-street current account peaked at £14,200 in June and closed the year at £3,100. Their Cash ISA peaked at £20,000. They take each peak in sterling, then convert both at the December 31 Treasury GBP rate. The aggregate of the peaks, not the closing balances, decides whether the $10,000 threshold is crossed. Here it clearly is, so both accounts are reported with their converted peak values.

A UAE account in dirhams

The UAE dirham is pegged to the US dollar by the Central Bank of the UAE at about 3.6725 AED per dollar. As a result, conversion for a Dubai account is stable year to year. An American in Dubai whose salary account peaked at AED 60,000 would divide by the Treasury AED rate, giving roughly $16,340, and round up. However, you still apply the published Treasury rate rather than the peg itself.

Joint, closed and signature-authority accounts

Special situations follow the same FBAR maximum account value principle: report the peak, converted at the December 31 rate.

Joint accounts

Each joint owner reports the full maximum value of a joint account, not their share. Married couples can file one joint FBAR in some cases, using FinCEN Form 114a. Our guide to FBAR signature authority and joint accounts covers the rules.

Accounts closed during the year

A closed account is still reported for the year in which it was open. Its maximum value is the highest balance before closure, converted at the December 31 rate of that year.

Penalties for getting the FBAR maximum account value wrong

FBAR penalties are set by 31 U.S.C. section 5321. Non-willful violations carry a penalty of up to $10,000, adjusted annually for inflation. In Bittner v. United States (2023), the Supreme Court held that the non-willful penalty applies per report, not per account. Willful violations are far more serious, reaching the greater of $100,000, inflation-adjusted, or 50% of the account balance. Therefore, a careful, documented calculation is your best protection. If you have missed FBARs in earlier years, the IRS Streamlined Filing Compliance Procedures may offer a route back into compliance.

Deadlines and record-keeping

The FBAR is due on April 15 following the calendar year, with an automatic extension to October 15 (IRS). No extension request is needed. Keep the statements you used to find each FBAR maximum account value for five years from the due date, as FinCEN requires. The IRS FBAR overview summarises the filing rules. For your wider US return, see our US expat tax returns page.

If you hold accounts in the UK, the UAE or both, book a consultation with our FBAR and FATCA team. We calculate every account's maximum value and file FinCEN Form 114 and Form 8938 together.

Frequently Asked Questions

What is the maximum account value on the FBAR?

The FBAR maximum account value is the highest balance a foreign account reached during the calendar year. You find it in the account's currency, convert it at the Treasury Reporting Rate of Exchange for December 31, and round up to the next whole US dollar. It is not the year-end balance.

Which exchange rate do I use for a UK bank account on the FBAR?

Use the US Treasury Reporting Rate of Exchange for sterling on the last day of the calendar year. You apply that December 31 rate even if the account peaked earlier in the year. Do not use the IRS yearly average rate or your bank's own rate.

Do I report the full balance of a joint account on my FBAR?

Yes. Each US person who jointly owns a foreign account reports the account's full maximum value, not a percentage share. Spouses may be able to file a single FBAR together by completing FinCEN Form 114a.

What if my foreign account was overdrawn all year?

Report a maximum account value of zero. The account must still be listed on the FBAR if your total foreign accounts exceeded $10,000 at any time during the year.

How do I value a UAE dirham account for the FBAR?

Take the highest dirham balance during the year and convert it using the US Treasury Reporting Rate of Exchange for the UAE dirham on December 31. Although the Central Bank of the UAE pegs the dirham at about 3.6725 per US dollar, you should use the published Treasury rate.

What is the penalty for reporting the wrong FBAR maximum value?

A non-willful FBAR violation can carry a penalty of up to $10,000 per report, adjusted for inflation, following the Supreme Court decision in Bittner v. United States (2023). Willful violations can reach the greater of $100,000, inflation-adjusted, or 50% of the account balance under 31 U.S.C. section 5321.