What Does FATCA Exempt Me From Reporting?

A federal law called the Foreign Assets Tax Compliance Act (FATCA) requires U.S. taxpayers to annually report the financial assets they hold in foreign accounts. The law covers assets in foreign financial institutions (FFIs) and specific other interests, but there are some notable exemptions. Learn more about what FATCA does, and does not, require you to report to the IRS.

The FATCA Reporting Requirements

If you are a U.S. person for tax purposes with offshore financial assets exceeding a threshold aggregate value, you must report them using Form 8938, Statement of Specified Financial Assets. You must file this form with your annual income tax return. If the aggregate balances of your foreign accounts exceeds $10,000 USD at any time during the tax year, you must also file a Statement of Foreign Bank and Financial Accounts (FBAR).

The Threshold Values for Reporting

You only need to report your foreign financial assets if their value exceeds a specific threshold. The values change periodically, so it is essential to confirm the current threshold on the IRS website or ask a tax preparation professional.

For the 2026 tax year, U.S. residents who are single or married filing separately must report if the value of their foreign assets exceeds $50,000 on December 31, or if the value exceeded $75,000 at any point during the year. The threshold amounts are doubled for married taxpayers filing jointly.

The thresholds are higher for taxpayers who live outside the U.S. If you are single or married filing separately you need not report your assets unless the aggregate value exceeds $200,000 on December 31 or exceeded $300,000 during the tax year. If you are married filing a joint return, these values double.

What Assets Are Exempt?

You must report financial assets held in accounts in FFIs. If you hold those assets jointly with a foreign spouse, you must report the entire balance. You also must report assets held for investment, such as foreign stocks held in a foreign brokerage, interests in foreign businesses, and foreign hedge fund investments.

FATCA exempts some foreign assets. For example, real estate that you hold directly is not reportable, although income it produces is reportable. The value of precious metals you hold does not count toward the threshold. Assets you use for your business need not be reported, and income you receive from a foreign public pension plan, similar to Social Security, may be exempt.

Speak With a Tax Controversy Attorney About FATCA Reporting Exemptions

FATCA violations can lead to penalties. If you believe you may have underreported your foreign assets, failed to report, or if you have received a letter from the IRS regarding FATCA issues, contact Pontius Tax Law, PLLC. Our tax lawyer and team of Enrolled Agents could review your situation and bring you into compliance.