FATCA Reporting 2026: Form 8938 Thresholds for Expats

FATCA (the Foreign Account Tax Compliance Act) requires US persons to report specified foreign financial assets on IRS Form 8938 when the value of those assets exceeds certain thresholds. Enacted in 2010 and effective for tax years beginning in 2011, FATCA operates alongside — but separately from — the FBAR requirement, and non-compliance can result in penalties of $10,000 to $50,000 plus a 40% underpayment penalty on unreported assets.

FATCA vs. FBAR: The Key Difference

FATCA and FBAR are often confused because they both relate to foreign accounts — but they are entirely separate obligations with different rules, thresholds, filing mechanisms and penalties:

FBAR (FinCEN Form 114): Filed with FinCEN (US Treasury), required from $10,000 aggregate, covers foreign financial accounts. Filed separately from your tax return.
FATCA (Form 8938): Filed with the IRS as part of your Form 1040, higher thresholds, broader scope covering specified foreign financial assets — including foreign entities, partnerships, and trusts, not just bank accounts. If you satisfy the FATCA thresholds, you must file Form 8938 even if the same assets are also reported on the FBAR.

FATCA Form 8938 Reporting Thresholds for 2026

The filing threshold depends on your filing status and whether you live in the US or abroad:

Expats Living Outside the US

Single / Married Filing Separately: Total value of specified foreign financial assets exceeds $200,000 on the last day of the tax year, or exceeds $300,000 at any point during the year
Married Filing Jointly: Total value exceeds $400,000 on the last day of the tax year, or exceeds $600,000 at any point during the year

These thresholds are significantly higher than the FBAR threshold, meaning many US expats in the UK who must file an FBAR do not also need to file Form 8938 — but those with substantial UK investments, pensions or property held through entities typically will.

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What Are “Specified Foreign Financial Assets”?

The scope of FATCA reporting is broader than FBAR. Specified foreign financial assets include:

Foreign bank accounts, savings accounts, and deposit accounts
Foreign investment accounts (brokerage accounts, stocks, bonds held with foreign institutions)
Foreign mutual funds and collective investment vehicles
Interests in foreign entities (foreign partnerships, foreign corporations, foreign trusts, foreign estates)
Foreign pension plans (including UK defined contribution pensions and SIPPs — if held outside a US tax treaty plan)
Foreign-issued life insurance contracts with cash value
Foreign annuity contracts
Any other financial instrument or contract with a foreign counterparty

Important: What Is NOT Reported on Form 8938

Foreign real estate held directly (though a foreign entity that holds real estate is reportable)
Assets reported on other specific forms (e.g., interests in foreign corporations on Form 5471)
Social Security-type benefits from foreign governments

UK-Specific FATCA Issues

UK pensions and FATCA

Whether a UK pension must be reported on Form 8938 is one of the most contested areas of US-UK tax compliance. Under the US-UK Tax Treaty, certain pension schemes may be exempt from FATCA reporting. Specifically, pension schemes covered under Article 17 of the treaty — and meeting the requirements of Revenue Procedure 2014-55 — may be excluded from Form 8938 reporting. However, this exclusion is not automatic and the rules are highly technical. UK SIPPs and some personal pensions may not qualify for exclusion.

UK ISAs

UK Individual Savings Accounts (ISAs) are generally reportable under FATCA if the applicable thresholds are met. The UK’s ISA tax exemption does not extend to US taxation — ISA income (dividends, interest, capital gains within the ISA wrapper) is fully taxable to US persons on their US returns, and the ISA must be reported on both the FBAR and potentially Form 8938.

UK Trusts and Estates

US beneficiaries of UK trusts or estates may have FATCA reporting obligations for their interests. The reporting can be complex, particularly for discretionary trusts where the beneficiary’s interest is not fixed. Our Trusts & Estates specialists can advise on UK trust reporting for US beneficiaries.

FATCA Penalties

Failure to file Form 8938: $10,000 penalty for each period of non-filing; up to $50,000 for continued failure after IRS notice
Underpayment penalty: 40% penalty on any underpayment of tax attributable to an undisclosed specified foreign financial asset
Statute of limitations: The normal 3-year period is extended to 6 years if Form 8938 is required but not filed; the statute remains open indefinitely if Form 8938 is fraudulently filed or not filed with intent to evade tax

FATCA and the IRS Streamlined procedures

Many US expats who were unaware of FATCA can use the IRS Streamlined Foreign Offshore Procedures to come into compliance. The programme covers missed Form 8938 filings alongside missed tax returns and FBARs. Our complete guide to IRS Streamlined Filing walks through the eligibility requirements and process.

Frequently Asked Questions About FATCA

Do I need to file both FBAR and Form 8938?

Potentially yes — they are separate obligations. The FBAR applies from a $10,000 aggregate threshold; Form 8938 has much higher thresholds for expats ($200,000/$400,000). Many expats with small UK bank accounts must file an FBAR but not Form 8938. Those with larger UK investment portfolios, pensions or business interests may need both.

Does my employer-sponsored UK pension count toward the FATCA threshold?

It may, depending on the type of pension and whether a treaty exclusion applies. This is a complex area. Most US expats should seek professional advice before assuming their UK pension is excluded from Form 8938.

Does FATCA affect UK banks and financial institutions?

Yes — FATCA requires UK financial institutions to identify US persons among their account holders and report their account information to HMRC (under the UK-US FATCA intergovernmental agreement), which then shares the data with the IRS. This means the IRS often already knows about UK accounts held by US persons — making voluntary compliance even more important.