US Expat Taxable Brokerage Accounts: 2026 Investment Considerations

US citizen or green card holder abroad with a taxable brokerage account? Five things decide whether it stays simple: whether your custodian keeps you, what you hold, how two countries tax the same income, how you track cost basis in dollars, and which forms it triggers. Here is the 2026 checklist.

• Custodian first. Use a US custodian that accepts your country, and give them your real address. See the 12-custodian hub and the Fidelity page.
• Hold US-domiciled funds. Foreign-domiciled funds and ETFs (UCITS and similar) are PFICs, with punitive tax and Form 8621 reporting.
• Expect two tax returns. Your new country will likely tax the account too. The foreign tax credit (Form 1116) or a treaty stops you paying twice.
• Track cost basis in dollars. Use the exchange rate on each trade date. Currency swings alone can create taxable gains or losses.
• Report foreign accounts. FBAR above $10,000 combined at any point in the year; Form 8938 above $200,000 for a single filer abroad ($400,000 joint).

It depends on the custodian and your country. Outcomes range from full service, to sell-only, to a closure letter with 30 to 90 days to act, and the treatment often changes when you update your address. Check the policy before you move, keep a US mailing address only if the terms allow it, and line up a second custodian. The hub article covers all twelve major firms.

This is the costliest expat mistake. Any fund or ETF domiciled outside the US is a PFIC to the IRS: taxed at the top ordinary rate plus interest on deferred gains, with a Form 8621 per fund per year. One UCITS ETF can cost more in accounting fees than it earns.

The fix: hold US-domiciled ETFs, US mutual funds, and individual stocks and bonds. Already own foreign funds? See PFIC tax solutions for the QEF and mark-to-market elections, and What is a PFIC for definitions. Some countries penalize US funds in turn (the UK's reporting fund regime is the best known), so the ideal holding is a US ETF with the local status you need.

The US taxes citizens on worldwide income, and your new country almost always taxes residents' investment income. Three tools keep you from paying twice:

• Foreign tax credit (Form 1116). Credits foreign tax against US tax on the same income. For investment income this, not the foreign earned income exclusion, is the tool that matters.
• Tax treaties. Under most US treaties, securities gains are taxed only where you live; dividends can be taxed by both, with a credit. Claim treaty positions on Form 8833 where required.
• US rates still apply. Qualified dividends and long-term gains stay at 0%, 15% or 20%, with the same holding periods.

The gap: the 3.8% net investment income tax generally cannot be offset by foreign tax credits, though treaty-based claims have succeeded for some countries. For the UK specifics, see US-UK taxes for expats.

US tax runs in dollars. Every purchase gets a dollar basis on the trade date and every sale is measured in dollars, so a position flat in euros can show a dollar gain. Keep your own exchange-rate log if your custodian reports in another currency. Wash sale rules apply worldwide, including foreign accounts, and your new country may have its own matching rules (like the UK's 30-day rule), so a trade clean in one system can be caught in the other.

• FBAR (FinCEN Form 114): all foreign accounts above $10,000 combined at any point. A US custodian account is not foreign; a foreign broker account is.
• Form 8938 (FATCA): abroad, above $200,000 at year end or $300,000 at any time (single), $400,000 or $600,000 (joint).
• Form 8621: one per PFIC per year, in most cases regardless of value.
• Form 1116 and Form 8833: foreign tax credit and treaty disclosure.
• Local declarations: for example, Spain's Modelo 720 above 50,000 euros per category.

Thresholds and deadlines: FBAR and FATCA filing guide. The rest of the return: 2026 US expat tax guide.

Capital gain brackets, the standard deduction and Form 8938 thresholds move most, and several custodians tightened residency rules in 2025 and 2026. Moving? Confirm custodian policy, sell foreign funds before year end or before becoming a US tax resident, document cost basis in dollars, and diarize FBAR (April 15, auto-extended to October 15) and your local deadline.

Can a US expat keep a taxable brokerage account in the United States?

Usually, depending on the custodian and your country. Some serve expats fully, some restrict trading, some close accounts. Check before you move and have a backup.

What should a US expat hold in a taxable brokerage account?

US-domiciled ETFs, US mutual funds and individual securities. Avoid foreign-domiciled funds: they are PFICs.

Do US expats pay capital gains tax twice?

Not if the foreign tax credit or a treaty is applied correctly. Most treaties give your country of residence the first right to tax securities gains.

Does a US brokerage account need to be reported on FBAR?

No. FBAR covers foreign accounts. A foreign broker account does count toward the $10,000 combined threshold.

Are there restrictions on options trading for international investors using a US brokerage?

Yes, at many custodians. Options and margin are often withdrawn for non-residents even when the cash account stays open.

Can I open a US brokerage account if I live outside the United States?

It depends on the custodian and your country of residence, not your citizenship. Several won't open a new account for a non-US address; others serve non-residents normally. Open it while you still have a US address if you can. The 12-custodian hub shows how each major firm treats non-residents; the Fidelity page covers one in detail.

Can I open a US brokerage account if I have dual citizenship?

Dual citizenship rarely decides it. Custodians go by your address of record. Citizenship decides the tax: the US taxes you on worldwide income, so the account stays on your US return even if your other country taxes it too.

What are the requirements for a joint US brokerage account?

Every owner faces the same residency test, so a joint account is usually treated by the most restricted owner's country. Get your custodian's position in writing. For reporting, Form 8938 thresholds abroad are higher for joint filers ($400,000 at year end or $600,000 at any time).

What are the key tax considerations for international investors?

Five, in order: will your custodian keep you, is anything a PFIC, how the foreign tax credit or a treaty stops double tax, how you track dollar cost basis, and which forms apply (FBAR, 8938, 8621, 1116, 8833, plus local ones like Modelo 720).

What if my country of residence taxes US funds differently?

Common, and it can pull against the PFIC rule; the UK's reporting fund regime is the best known case. Look for a US-domiciled ETF that also has the local status you need, and check both sides before you buy.

What should international investors know before buying an individual US stock?

Individual stocks and bonds are not PFICs, so no Form 8621. Everything else applies: dollar cost basis on the trade date, dividends taxable in both countries with the credit as the fix, and worldwide wash sale rules.

Is margin or options trading available to international investors?

Often not. These are usually the first privileges withdrawn after an address change, even when the cash account stays open. Confirm your custodian's policy for your country.

What should I do before I move?

Treat the address change as the deadline. Confirm your custodian's policy for the new country, sell foreign-domiciled funds before year end if you hold any, document cost basis in dollars, line up a backup custodian, and diarize FBAR (April 15, extension to October 15) and your local deadline.

Aequify pulls your US and foreign accounts into one view, flags PFIC holdings and reporting thresholds automatically, and produces tax-ready data packs for your advisers on both sides. Moving? The scenario planner shows what the same portfolio costs under each residence before you decide.

This article provides general information and is not tax, legal or investment advice. Rules vary by country, account type and individual circumstances. Confirm current thresholds and custodian policies with qualified advisers before acting.