Yes, you can have a foreign bank account, but the rules depend on your citizenship and where you live

If you are a U.S. citizen or permanent resident living abroad, you can open a bank account in another country. If you are a non-U.S. citizen living outside the United States, you can also open accounts in your home country or in countries where you have legal residency. The main constraint is not whether you are allowed to have the account — it is that banks in other countries are increasingly cautious about opening accounts for U.S. citizens, and U.S. banks have strict rules about reporting foreign accounts.

The practical challenge is not permission; it is finding a bank willing to work with you and understanding what you must report to the U.S. government if you are a U.S. citizen or resident.

Key Takeaways

  • U.S. citizens and permanent residents can open foreign bank accounts, but many international banks now decline U.S. customers because of U.S. reporting requirements.
  • If you are a U.S. citizen with a foreign account holding more than $10,000 at any point during the year, you must file a report called the FBAR (Foreign Bank Account Report) with the U.S. Treasury.
  • You will also report the account on your U.S. tax return using Form 8938 if the total value of your foreign financial accounts exceeds certain thresholds that depend on your filing status and whether you live abroad.
  • Non-U.S. citizens living in their home country typically face fewer reporting requirements, but should confirm the rules with a local tax professional.
  • Opening a foreign account usually requires proof of residency, a passport or national ID, and sometimes a letter from your employer or proof of income.

Why banks are hesitant to open accounts for U.S. citizens

After 2010, the U.S. government passed the Foreign Account Tax Compliance Act (FATCA), which requires foreign banks to report accounts held by U.S. citizens to the U.S. Internal Revenue Service (IRS). This created a burden for international banks: they must track which customers are U.S. citizens, verify their tax identification numbers, and file reports with the IRS. Many banks decided this was too costly and straightforward stopped accepting U.S. customers.

This does not mean you cannot open an account — it means you may need to look harder. Banks in countries with strong ties to the United States, such as Canada, the United Kingdom, and Australia, are more likely to accept U.S. citizens because they are already set up to handle FATCA reporting. Banks in smaller countries or those with less developed banking infrastructure may refuse outright.

If you are not a U.S. citizen and do not hold U.S. citizenship, you will not trigger FATCA reporting requirements, and banks in your home country will usually accept you without hesitation.

The FBAR requirement for U.S. citizens and residents

The FBAR (Foreign Bank Account Report) is a form you file with the U.S. Treasury Department, not the IRS. You must file it if you are a U.S. citizen or permanent resident and you have a financial interest in or signature authority over a foreign account that holds more than $10,000 at any time during the calendar year.

"Financial interest" means you own the account or have the right to control the money in it. "Signature authority" means you can sign checks or withdraw money from someone else's account — for example, if you are a power of attorney for a parent's account abroad. The $10,000 threshold is combined across all your foreign accounts, so if you have three accounts worth $4,000, $3,000, and $4,000, you must file.

The FBAR is filed electronically through FinCEN (Financial Crimes Enforcement Network) by April 15 of the following year, with an automatic extension to October 15. If you do not file when required, the penalties are steep — up to $10,000 per violation, and potentially much higher if the IRS determines the violation was willful.

Form 8938 and your U.S. tax return

In addition to the FBAR, you may also need to file Form 8938 (Statement of Specified Foreign Financial Assets) with your annual U.S. tax return. This form reports the same accounts but uses different thresholds and goes to the IRS rather than the Treasury.

You file Form 8938 if the total value of your foreign financial accounts exceeds certain amounts. For a single filer living in the United States, the threshold is $200,000 on the last day of the year or $300,000 at any point during the year. For a married couple filing jointly, it is $400,000 or $600,000. If you live abroad, the thresholds are higher: $400,000 on the last day of the year or $600,000 at any point during the year for a single filer, and $800,000 or $1.2 million for married filing jointly.

The thresholds are lower than the FBAR threshold, so you may need to file Form 8938 even if your account is below $10,000. If you are unsure whether you must file, a tax professional who works with expats can review your situation.

What documents you will need to open an account

Most banks abroad will ask for a valid passport or national ID card, proof of your current address (usually a utility bill or lease dated within the last three months), and proof of income or employment. Some banks also ask for a reference letter from your previous bank or employer.

If you are self-employed or a freelancer, you may need to provide tax returns or bank statements showing regular income. If you are retired, you may need to show pension statements or investment account statements. The exact requirements vary by country and by bank, so contact the bank directly before you visit or submit documents.

If you are opening an account while living abroad, you can often do this online or by mail, but some banks still require an in-person visit. A few banks will accept video verification of your identity instead. Ask whether the bank offers remote account opening before you make a trip.

Different rules for non-U.S. citizens

If you are not a U.S. citizen and you do not hold a U.S. green card, you generally do not have to file the FBAR or Form 8938 with the U.S. government. You will, however, have to follow the tax laws of the country where you live and where your bank account is located.

Most countries require residents to report foreign income and foreign accounts to their local tax authority. The rules vary widely — some countries tax only income earned within their borders, while others tax worldwide income for residents. Some require you to report accounts above a certain threshold, while others require reporting of all accounts.

Before you open a foreign account, check the tax laws of your country of residence or consult a local tax professional. This will save you from accidentally breaking a reporting requirement later.

Alternatives if you cannot open a foreign account

If banks in your country refuse to open an account for you, or if the reporting requirements feel too complex, you have other options. Many U.S. banks now offer accounts to customers living abroad, including Chase, Bank of America, and Citibank. These accounts are subject to the same FBAR and Form 8938 requirements, but you may find them easier to manage because you can use online banking and customer service in English.

Some expats also use fintech services like Wise (formerly TransferWise), Revolut, or N26, which offer multi-currency accounts and low-cost international transfers. These are not traditional bank accounts, but they can hold money in different currencies and allow you to spend abroad without high fees. They are still subject to FBAR reporting if the balance exceeds $10,000.

Another option is to keep a U.S. bank account open and use it for international transfers. This requires less paperwork and reporting, though you may pay higher fees for international transactions.

Frequently Asked Questions

Do I have to report a foreign account if I am a U.S. citizen living abroad?

Yes, if the account holds more than $10,000 at any time during the year, you must file the FBAR. You may also need to file Form 8938 depending on the account balance and your filing status. Even if the account is below $10,000, you must report the income it generates on your U.S. tax return.

What happens if I forget to file the FBAR?

The IRS can impose penalties of up to $10,000 per violation. If you discover you missed a filing, you can file it late and request a penalty waiver if you have reasonable cause. A tax professional who works with expats can help you file back years and request relief.

Can I open a foreign account if I am a permanent resident but not yet a U.S. citizen?

Yes, and you are subject to the same FBAR and Form 8938 requirements as a U.S. citizen. Permanent residents must report foreign accounts to the U.S. government in the same way.

Will opening a foreign account affect my credit score in the United States?

No. Foreign bank accounts do not appear on U.S. credit reports and do not affect your credit score. However, if you use a foreign account to pay U.S. debts, those payments will be reported normally and will affect your score in the usual way.

Can I hide a foreign account from the U.S. government?

No, and attempting to do so carries serious criminal penalties including fines and imprisonment. Banks are required to report U.S. account holders to the IRS, and the U.S. government has agreements with most countries to share financial information. If you have unreported accounts, consult a tax attorney about coming into compliance.