Am I exempt from FATCA reporting? Rules, exemptions & filing requirements (2026)
The Foreign Account Tax Compliance Act (FATCA) is a US law designed to prevent tax evasion by Americans holding money and investments overseas. If you're a US taxpayer or specified domestic entity with foreign assets, knowing whether you need to file, which assets count, and what happens if you don't is essential.
Quick answers
| Topic | Details |
|---|---|
| Who files? | Specified individuals and certain specified domestic entities that meet the Form 8938 threshold. This generally includes US citizens, resident aliens, and certain limited cases involving individuals treated as residents under special tax rules. |
| Who may be exempt? | Taxpayers not required to file a US income tax return, taxpayers whose foreign assets don’t exceed the applicable threshold, and those with certain excepted assets |
| What counts? | Foreign bank accounts, foreign stocks, interests in foreign entities, and certain financial instruments |
| Deadline (2025 tax year) | April 15, 2026–expats get an automatic extension to June 15, 2026, with a further extension to October 15, 2026, available on request |
In this article, we break down the FATCA reporting requirements, explain who qualifies for a FATCA exemption, and cover what to do if you've missed a Form 8938 filing.
This article is brought to you by Taxes for Expats (TFX) – a top-rated tax firm serving US citizens, residents, and anyone with US tax obligations, both at home and abroad. Need help with FATCA reporting? Explore our articles or schedule your free discovery call for personalized support.
What is FATCA, and what are the reporting requirements?
The Foreign Account Tax Compliance Act (FATCA) is a US law enacted in 2010 to combat tax evasion by US taxpayers holding financial assets outside the United States. If you're a US taxpayer or specified domestic entity with foreign accounts or assets above certain thresholds, you must report them to the IRS annually.
Three things worth separating from the start:
- FATCA is the law itself
- Form 8938 is the form individual taxpayers file with the IRS
- Foreign banks and financial institutions may separately report your accounts to the IRS under FATCA – that's their obligation, not yours to file
If your foreign assets exceed the threshold for your filing status and residency, you attach Form 8938 to your annual tax return. The thresholds, what counts as a reportable asset, and who qualifies for an exemption are all covered below.
What financial accounts and assets are reportable under FATCA?
The IRS defines specified foreign financial assets as foreign financial accounts and non-account assets held for investment purposes – not assets used in a trade or business. Before checking whether you meet the threshold, you need to know what actually counts.
Usually reportable:
- Foreign financial accounts – savings, checking, brokerage, or other accounts at foreign banks
- Foreign stocks and securities – shares or bonds issued by foreign corporations or governments
- Foreign financial instruments and contracts with non-US persons – promissory notes, options, derivatives
- Interests in foreign entities – ownership in foreign partnerships, trusts, or estates
- Foreign-issued life insurance with a cash surrender value
Usually not reportable:
- Directly held foreign real estate – unless it's held through a foreign entity such as a corporation or partnership
- Foreign currency
- Foreign government social security or similar benefits
- Accounts held at a US branch of a foreign bank – these are treated as domestic accounts for Form 8938 purposes
- Accounts held at a foreign branch or foreign affiliate of a US bank – also excluded from Form 8938 reporting
Before checking thresholds, determine the fair market value of each asset. Use account statements for financial accounts, publicly available data for assets not held in an account, and your year-end balance for foreign pension or deferred compensation plans.
FATCA filing requirements: who needs to file Form 8938?
Whether Form 8938 is required depends on where you live, your filing status, and the total value of your foreign assets. The thresholds differ significantly for US residents and expats living abroad – check your filing deadlines once you confirm which category applies to you.
FATCA filing thresholds for US residents
US residents must file Form 8938 if their combined foreign assets exceed the values below. Exceeding either condition – year-end value or value at any point during the year – triggers the filing requirement.
| Filing status | Year-end value | At any point during the year |
|---|---|---|
| Single / MFS | $50,000 | $75,000 |
| MFJ | $100,000 | $150,000 |
Filing thresholds for US expats living abroad
Expats living outside the US qualify for higher thresholds, but only if they meet two conditions: their tax home must be in a foreign country, and they must satisfy either the bona fide residence test or the physical presence test for the year.
| Filing status | Year-end value | At any point during the year |
|---|---|---|
| Single / MFS | $200,000 | $300,000 |
| MFJ | $400,000 | $600,000 |
For the 2025 tax year, Form 8938 is due with your return on April 15, 2026. If your tax home and abode are outside the US on the due date, you get an automatic extension to June 15, 2026; filing Form 4868 by then extends the deadline to October 15, 2026.
Who is exempt from FATCA reporting?
There are three distinct situations where Form 8938 isn't required – and mixing them up can cause real problems.
You may not need to file because:
- No US return is required – if the IRS doesn't require you to file a US income tax return for the year, Form 8938 isn't required either, regardless of your asset values
- You're below the threshold – your foreign assets exist but don't cross the filing threshold for your filing status and residency; this is not a formal FATCA exemption, but no filing is triggered
- If an asset is already reported on another IRS form – such as Form 3520 or Form 8621 – you generally do not list it again on Form 8938. You still identify the other form in Part IV, and for specified individuals, the asset's value still counts toward the reporting threshold.
FATCA-exempt financial assets
Not all foreign assets trigger a Form 8938 obligation. The table below covers the most common categories.
| Asset type | Report on Form 8938? | Notes |
|---|---|---|
| Accounts at US branches of foreign banks | No | Treated as domestic accounts |
| Accounts at foreign branches or foreign affiliates of US banks | No | Excluded from Form 8938 reporting; may still be relevant for FBAR |
| Foreign government social insurance | No | Comparable to US Social Security |
| Interests in foreign trusts or estates reported on Form 3520 | No – identify Form 3520 in Part IV | Asset value still counts toward the threshold |
| Directly held foreign real estate | No | Unless held via a foreign entity |
| Foreign currency | No | Not a specified financial asset |
"Not reportable on Form 8938" is not the same as being fully exempt from FATCA reporting. Foreign banks still perform their own due diligence on US account holders under their separate FATCA obligations.
Also read. FBAR vs Form 8938
Who is exempt from FATCA reporting vs who is simply below the Form 8938 threshold?
Being a FATCA-exempt beneficial owner or holding a W-9 exemption code is fundamentally different from simply not meeting the filing threshold. Here's how to tell which situation applies to you.
Below the threshold
Your foreign assets exist, but their combined value doesn't cross the filing threshold for your filing status and residency. No Form 8938 is required for that year – but you're not formally exempt from FATCA reporting, and asset values should be tracked year to year.
Not required to file a US return
If the IRS doesn't require you to file a US income tax return for the year, Form 8938 is also not required – regardless of what your foreign assets are worth.
Asset or account exception
Certain assets are excluded from Form 8938 even if you meet the threshold – either because they fall into a defined IRS exception or because they're already covered by another international form.
Am I exempt from FATCA reporting?
The answer depends on which of these three situations applies to you.
FATCA exemption codes on Form W-9: what they mean – and when they do not apply
Most individual expats filing Form 8938 will never need to enter a FATCA exemption code on that form. These codes belong on Form W-9 and apply to certain entities, not individual taxpayers.
What is a FATCA exemption code?
A FATCA exemption code is a one-letter code shown in the Exemptions section of Form W-9 for certain payees or account holders in limited situations. For most individual Form 8938 filers, these codes are not relevant and do not replace any separate Form 8938 filing obligation. The current IRS Form W-9 instructions list the full FATCA codes list – codes A through M.
A few examples:
| Code | Exempt party |
|---|---|
| A | Organization exempt under IRC §501(a) |
| B | US federal, state, or local government agency |
| C | International organization or foreign government |
| E | Corporation in the same expanded affiliated group as a publicly traded company – exemption from FATCA reporting code E |
W-9 FATCA exemption codes are for entities certifying their status to financial institutions – not for individual expats filing Form 8938.
The exempt from backup withholding and/or FATCA reporting field on Form W-9 is separate from your Form 8938 obligations. Entering a code there tells the bank about your entity's withholding status – it does not remove your personal foreign asset reporting requirement.
If a foreign bank sent you paperwork asking for your FATCA reporting exemption code, receiving a FATCA letter from your bank is more common than you'd think – and it doesn't always mean you owe anything.
Missed FATCA reporting? Here's what to do
If you missed filing Form 8938, the first step is to confirm whether it was actually required in the first place. Many expats discover they were below the threshold for one or more of the years in question.
A practical order of operations:
- Check whether Form 8938 was required – verify your thresholds and whether a US return was due for that year
- Gather your records – account statements, asset valuations, and any forms already filed
- Determine whether your failure was non-willful – this decides which IRS correction path is available to you
- Consider the streamlined filing procedures – designed for taxpayers who missed reporting unintentionally
FATCA penalties for non-compliance (Form 8938)
The IRS may impose a $10,000 initial penalty for failing to file Form 8938. If the failure continues for more than 90 days after the IRS mails a notice, additional penalties of $10,000 for each 30-day period or part of a period may apply, up to a maximum additional penalty of $50,000.
If you underreported income tied to undisclosed foreign assets – for example, dividends from a foreign brokerage account not included on Form 8938 – the penalty can reach 40% of the underpaid tax. In fraud cases, that rises to 75%.
Reasonable cause can apply. If you can show the failure was due to reasonable cause and not willful neglect, the IRS may waive the penalty.
Options for late filers: streamlined procedures and next steps
The IRS streamlined filing compliance procedures are one correction option for taxpayers whose failure to report foreign financial assets was non-willful.
- Confirm non-willful status – the streamlined filing compliance procedures require that your failure to file was not intentional; if you're unsure, speak with a tax professional before submitting anything
- Identify the missing years – the streamlined foreign offshore procedure generally covers the most recent three tax years for which the return due date, including any valid extension, has already passed
- Attach Form 8938 where required – since Form 8938 is part of your annual tax return, include it with any amended or delinquent returns; the streamlined domestic offshore procedure applies if you were living in the US during the missed years
Learn more
FATCA vs. FBAR: key differences
FATCA and FBAR are two separate reporting requirements that often apply to the same person at the same time – but filing one does not satisfy the other.
For most expats with foreign bank accounts above $10,000, both FBAR and Form 8938 may apply simultaneously – the thresholds, assets covered, forms, and filing destinations are all different.
| FBAR (FinCEN Form 114) | FATCA (Form 8938) | |
|---|---|---|
| Threshold | $10,000 at any point during the year | $50,000–$600,000 depending on residency and filing status |
| Assets covered | Foreign bank accounts only | Foreign accounts, stocks, bonds, partnership interests, life insurance, and more |
| Form | FinCEN Form 114 | Form 8938, attached to your tax return |
| Filing destination | FinCEN – separate from the IRS | IRS, with your annual return |
Need help with FATCA compliance or exemptions?
FATCA reporting has layers. At Taxes for Expats, we help you determine whether Form 8938 is actually required for your situation, which assets count toward the threshold, and whether any exceptions apply.
FAQ
No. FATCA applies to US citizens, green card holders, and certain resident aliens classified as "specified individuals" under the law. It also imposes separate obligations on foreign financial institutions that hold accounts for US taxpayers.
You are not required to file Form 8938 in three situations: no US income tax return is required for the year, your assets fall below the applicable threshold, or a specific exception applies to a particular asset. Being below the threshold – is not a formal exemption – it simply means no filing is triggered for that year.
Living abroad raises the filing threshold, but doesn't make you exempt from the Foreign Account Tax Compliance Act (FATCA) reporting automatically. Single expats must file once foreign assets exceed $200,000 at year-end or $300,000 at any point during the year. Full exemption only applies if no US income tax return is required.
It is a one-letter code (A through M) used by certain entities on Form W-9 to signal exempt status to a financial institution. If you've been asked to provide an exempt from FATCA reporting code and you're an individual, that request relates to bank account paperwork, not your Form 8938 filing. Individual expats do not use these codes on Form 8938.
Form 8938 is attached to your annual tax return. For the 2025 tax year, the deadline is April 15, 2026. If your tax home and abode are outside the US on the due date, you get an automatic extension to June 15, 2026; filing Form 4868 by then extends the deadline to October 15, 2026.
Yes. FATCA reporting requirements are mandatory for US taxpayers holding specified foreign financial assets above the applicable threshold. Both individual filers and foreign financial institutions have separate obligations under the law.
A FATCA exemption applies if no US return is required for the year, your assets fall below the threshold, or a specific asset is already reported on another IRS form, such as Form 3520 or Form 8621. Institutional categories – such as foreign governments and certain retirement funds – may qualify as exempt FATCA reporting entities under separate IRS rules.
No. FATCA nil reporting is not required for individual expats who fall below the filing threshold. If Form 8938 isn't triggered, you simply don't file – there's no obligation to submit a return with zero reportable assets.
