What is the minimum requirement for filing Form 114, Report of Foreign and Financial Accounts (FBAR)?

To determine the requirement for filing Form 114, Report of Foreign Bank and Financial Accounts (FBAR), it's essential to understand the threshold set by the Financial Crimes Enforcement Network (FinCEN). The correct requirement states that when the aggregate value of all foreign accounts exceeds $10,000 at any point during the calendar year, a taxpayer must file the FBAR.

This requirement emphasizes the importance of the total value of all foreign financial accounts combined, rather than focusing on individual accounts. Therefore, it's sufficient if the total surpasses that threshold at any moment within the year. This standard is intended to capture instances where individuals or entities may have multiple accounts that collectively exceed the reporting limit, thus ensuring compliance and proper disclosure of foreign financial assets.

Options that focus on the value of individual accounts, whether exceeding or averaging a particular amount, do not comply with the FBAR filing requirement. The threshold is specifically based on the aggregate value, making it crucial to assess the total of all accounts held abroad.