FATCA

FATCA, the Foreign Account Tax Compliance Act, is a U.S. law that requires certain U.S. taxpayers to report specified foreign financial assets on Form 8938 when those assets exceed IRS thresholds. FATCA also requires many foreign financial institutions to report accounts held by U.S. persons to the IRS.

Why it matters for U.S. expats

FATCA affects U.S. expats with foreign bank accounts, investment accounts, pensions, foreign business interests, and other offshore financial assets. It can create an annual Form 8938 filing requirement, increase IRS visibility into foreign accounts, and overlap with FBAR reporting without replacing it.

Common questions

1. Do U.S. expats need to file under FATCA?

Yes, if their specified foreign financial assets exceed the Form 8938 reporting thresholds. For many U.S. expats filing single or married filing separately, the threshold is more than $200,000 on the last day of the year or more than $300,000 at any point during the year.

2. Is FATCA the same as FBAR?

No. FATCA reporting is done on Form 8938 and filed with the IRS as part of the tax return. FBAR is filed separately as FinCEN Form 114 through the BSA E-Filing system.

3. What assets are reported under FATCA?

FATCA can cover foreign bank accounts, foreign brokerage accounts, foreign stocks and securities, foreign partnership interests, foreign pension interests, and certain other specified foreign financial assets.

4. How do U.S. expats file FATCA reports under Section 6038D?

They file Form 8938 with their federal income tax return. The form reports the type, value, location, and ownership details of specified foreign financial assets.

5. How does the IRS find out about foreign bank accounts?

Foreign financial institutions can report U.S.-owned accounts to the IRS under FATCA. The IRS may also receive information through tax treaties, information exchange agreements, FBAR filings, Form 8938, and other international reporting forms.

6. Do foreign banks ask U.S. expats for FATCA information?

Yes. A foreign bank may ask for a U.S. taxpayer identification number, citizenship information, or a Form W-9 to confirm whether an account holder is a U.S. person.

7. What happens if Form 8938 is not filed?

Failure to file Form 8938 can lead to IRS penalties. Missing Form 8938 can also keep the statute of limitations open for parts of the tax return.

Related forms

• Form 8938: FATCA reporting for U.S. expats
• Form 1040: U.S. Individual Income Tax Return
• FinCEN Form 114: FBAR reporting
• Form W-9: Request for Taxpayer Identification Number and Certification

When to get help

Professional guidance is important when:

• Your foreign financial assets are close to or above the Form 8938 thresholds.
• You are unsure whether a pension, investment account, or foreign entity interest is reportable.
• You need to file both Form 8938 and FBAR.
• A foreign bank has asked you for U.S. tax forms or FATCA documentation.
• You missed Form 8938 in a prior year.
• You own foreign business interests, foreign trusts, or foreign investment funds.

Bright!Tax can determine whether FATCA reporting applies, prepare Form 8938, and help coordinate FATCA with FBAR and other foreign asset filings. Get started with Bright!Tax.

Related Bright!Tax guides

• What is FATCA and why it matters for U.S. citizens abroad
• FBAR vs. Form 8938: Which one applies to you
• Do you qualify for FATCA exemptions?

Official sources

• IRS: Foreign Account Tax Compliance Act
• IRS: FATCA information for individuals
• IRS: About Form 8938
• IRS: Do I need to file Form 8938?

Reviewed by

Katelynn Minott, CPA & CEO

Last reviewed

June 2026