Investing in France as a US citizen or green-card holder

As a US citizen or green-card holder living in France, you need to review investments through both countries’ rules. We examine the French side of your wealth planning and coordinate the questions for your US tax adviser. The starting point is the accounts you already hold and the decisions you are considering.

Living in France with US citizenship or US tax-resident status can bring tax and reporting duties in both countries. The treaty provides relief under specific rules, but the systems can classify an account or investment differently. Review the existing holdings before choosing what to keep, sell or add, with the French and US advisers working from the same documents.

Prepare your US–France wealth review

Keep the account-level questions separate from the overall investment plan. A decision about retaining an account is not the same as a decision about what to hold inside it, withdraw from it or leave to a beneficiary.

List your bank, brokerage and retirement accounts, with the institutions that hold them.
Identify any planned investment sale, retirement withdrawal or change of beneficiary.
Gather information on employee shares and other assets whose timing may matter to the move.
Agree which professional will handle each French and US tax or reporting question before implementing the plan.

The two constraints that shape everything

FATCA — the US Foreign Account Tax Compliance Act — obliges French banks to identify US persons and report their accounts, through the French tax authority, to the IRS under the France–US agreement of 14 November 2013. A bank may decline to open an account for a US person rather than carry that obligation, so the account itself is the first thing to arrange before the move;
PFIC: most French and European funds are Passive Foreign Investment Companies for US tax purposes, with a punitive reporting and taxation regime that can erase any return. Whether the funds inside a French assurance-vie are reached by that regime is not settled: depending on how the contract is built, US law may treat it as insurance, as an investment product, or look through the policy to the funds inside it. There is no general answer: the contract has to be characterised, document in hand, before you buy it.

Investment routes to compare

Direct securities, funds accessible to French residents, property and suitable insurance arrangements can each be considered. None is automatically exempt from cross-border difficulties. Confirm provider access and the treatment of the specific holding, then apply the France–US treaty as amended, including the relevant saving-clause exceptions and double-taxation relief. A credit is subject to conditions and does not always match every euro of foreign tax.

We coordinate the French wealth review with your US tax professional. The investment proposal and reporting documents need to be examined together; this coordination does not replace US tax advice.

Bank reporting and your own declarations

Reporting by your bank does not replace your own declarations. FATCA includes reporting by financial institutions and, for certain taxpayers, Form 8938. FBAR is a separate requirement.

Your bank — FATCA reporting
Financial institutions report information under the applicable FATCA arrangements. This does not settle your own filing duties.
You — FBAR / FinCEN Form 114
Check whether your foreign financial accounts meet the FBAR requirements. Where a filing is required, it goes to FinCEN separately from your federal tax return.
You — Form 8938
Check the separate rules for specified foreign financial assets. Where required, Form 8938 accompanies your federal tax return. Its scope and thresholds differ from FBAR.

You may need one form, both or neither. Filing one does not satisfy the other. Check the treatment of each account or policy with your US tax adviser.

This section follows two IRS pages: Summary of FATCA reporting for U.S. taxpayers ↗ and Comparison of Form 8938 and FBAR requirements ↗.

These declarations are separate from the calculation of French tax, and they run on their own timetable.

French reporting duties need a separate review. Reporting foreign accounts, policies and trusts in France explains that side of the file.

French forced heirship, your US will, and the election of US law

Review the estate with the applicable succession law and family ownership in mind. Regulation (EU) No 650/2012 may permit a choice of national law, while US federal estate-tax questions and any relevant state rules require their own analysis. French forced-heirship rules for foreign residents explains the French starting point. Residence in France does not make every US will ineffective, and US citizenship does not mean every state’s rules apply worldwide.

Who will work with you?

Véronique Yang is a private wealth manager based in Paris, and she follows foreign nationals settling in France: tax residence, the first returns, and the treatment of the assets and policies you keep abroad. The firm handles the French side of the file — which accounts and contracts are open to you, what has to be reported, and in which order the decisions are taken.

Your US return, the treatment of a fund under the PFIC rules and any US estate-tax question stay with your own US adviser; we work from the same documents rather than in parallel. Cross-border wealth advisers in France sets out the scope of the work and who carries it out.

References cited

Règlement (UE) n° 650/2012 · IRS — France tax treaty documents: 1994 Convention as amended by the 2004 and 2009 Protocols (saving clause: Article 29(2), replaced by the 2009 Protocol; Article 29(3), replaced by the 2004 Protocol) · France–US FATCA agreement (signed 14 November 2013, in force 14 October 2014) — published by décret n° 2015-1 of 2 January 2015 · CJUE, 18 janvier 2018, Jahin, C-45/17 · IRS — Summary of FATCA reporting for U.S. taxpayers · IRS — Comparison of Form 8938 and FBAR requirements

Frequently asked questions

Can a US citizen open an assurance-vie in France?

Some providers can consider US persons, subject to the policy and residence profile. Acceptance alone does not establish a favourable US tax treatment. Have the contract and underlying holdings reviewed before subscribing, including PFIC and reporting consequences.

Why do French banks refuse American clients?

US reporting and compliance requirements can affect a provider’s commercial policy. Ask which services it offers to your profile and what documents it requires. If a basic account is refused, the French right-to-an-account procedure may be relevant under its conditions.

Do I pay French social charges on my US investment income?

French social levies can apply, with the treatment depending on the income and affiliation. The relief that exempts people affiliated to a social-security scheme in the European Union, the EEA or Switzerland does not extend to a scheme outside that area: in Jahin (18 January 2018, C-45/17) the Court of Justice held that this difference of treatment is permitted, in a case where the taxpayer was affiliated in a third country. The IRS has stated that CSG and CRDS are not excluded from US foreign-tax-credit eligibility merely by the France–US social-security agreement. Normal credit conditions and limits still apply, so this is not a guaranteed dollar-for-dollar refund.

Do I need to file an FBAR if I already report my accounts through FATCA?

Bank reporting does not replace your own obligations. Check FBAR and Form 8938 separately against their definitions and thresholds. You may need one, both or neither for a particular situation; filing one does not automatically satisfy the other.

Does French forced heirship affect US estate planning?

It can. Establish the succession law, any valid national-law choice and the family’s ownership arrangements. Coordinate that with US federal and relevant state issues. Existing wills and trusts should be reviewed together rather than replaced on the assumption that all their provisions fail in France.

ÉTHIQUE ET PATRIMOINE, a French simplified joint-stock company (SAS), registered office at 41 rue Saint-Ferdinand, 75017 Paris, France, Paris Trade Register no. 803 414 796, VAT no. FR 40 803 414 796, registered with ORIAS under number no. 24001817 (www.orias.fr) — Financial investment adviser (CIF) no. 18002418, member of ANACOFI-CIF, a professional association approved by the Autorité des marchés financiers, and Anacofi-Courtage for its brokerage activity. Presence: Paris, Montpellier, London, Singapore, Hong Kong, Bangkok, Shanghai and Dubai.

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