U.S. taxes for Americans in France: what to file, and how to catch up.
Americans in France still file a U.S. return every year, but French tax is usually high enough that the foreign tax credit wipes out most U.S. tax. The traps are in France’s favourite savings products, which the IRS doesn’t treat the way France does. Most people who fell behind can catch up under the Streamlined procedures, with no penalty if they qualify.
Sound familiar?
- You file your déclaration de revenus every spring and assumed that was enough.
- Your French bank asked you to fill in a W-9.
- You have an assurance-vie your family helped you open.
- You’re a dual national who has never filed a U.S. return.
How does the IRS treat assurance-vie, PEAs and other French accounts?
Every one of these goes on your FBAR. What differs is how the IRS taxes them.
| Account | U.S. treatment | |
|---|---|---|
| Assurance-vie | Usually reportable as a foreign account. Funds inside can be PFICs, and growth may be taxable for the U.S. | Watch out |
| PEA | Not tax-free for the U.S. Dividends and gains are taxable, and funds inside are usually PFICs. | Watch out |
| Livret A and LDDS | Tax-free in France, but the interest is taxable on your U.S. return. | Taxable |
| PER (retirement savings plan) | Tax-favoured in France, but U.S. treatment depends on the plan: growth could be taxable for the U.S. as it builds. | Check first |
| French pensions (retraite) | Pensions from French social security, both the basic plan and the complementary plans (AGIRC-ARRCO), are taxable only in France, even for U.S. citizens. Other pensions depend on the plan. | Mostly friendly |
| CSG and CRDS | They count toward the foreign tax credit. The IRS stopped disputing this in 2019, and years you didn’t claim can be amended, generally for up to 10 years. | Mostly friendly |
| SCI (property company) | For U.S. purposes an SCI is often treated as a partnership, which can mean an extra U.S. form each year on top of reporting the rent. | Check first |
Which French investments are PFICs?
French funds of every kind, SICAVs, FCPs and OPCVMs, and the ETFs French brokers sell, most of them based in France, Ireland or Luxembourg. For U.S. tax they’re passive foreign investment companies, or PFICs, and that doesn’t change inside a PEA or an assurance-vie.
- Each fund needs its own Form 8621 in most years, and gains can be taxed at the top U.S. rate plus an interest charge, unless an election was made in time.
- In an assurance-vie, whether the funds inside count as yours for the PFIC rules depends on how the contract itself is treated for U.S. tax, which is an unsettled area.
- Not PFICs: shares of individual companies, French government bonds, and bank savings such as the Livret A.
A PEA of individual shares is far simpler for the U.S. than one full of funds, which is worth knowing before you add to it.
What does the U.S.–France tax treaty actually say?
The treaty was signed in 1994 and updated by protocols in 2004 and 2009. For Americans living in France, these parts matter most:
- The saving clause. The U.S. can tax its citizens as if the treaty didn’t exist, except for the provisions the treaty lists.
- Special rules for U.S. citizens living in France. The treaty sets out how each country gives credit for the other’s tax, so income both countries tax isn’t taxed in full twice.
- French social security pensions. Taxable only in France, even for U.S. citizens, so the U.S. doesn’t tax your French retraite.
- CSG and CRDS. Since 2019, the IRS has accepted that they count toward the foreign tax credit under the treaty.
Social security contributions are covered by a separate U.S.–France agreement, which generally means you pay into one system, not both. Read the U.S.–France tax treaty on IRS.gov.
When are French and U.S. taxes due?
Both tax years run January to December, so each French year lines up with one U.S. return. Your avis d’impôt gives most of what the U.S. return needs.
| France | United States | |
|---|---|---|
| Tax year | January to December | January to December |
| Annual return | In May or early June, depending on where you live and whether you file online | April 15, moved to June 15 automatically when you live abroad, or October 15 with an extension |
| Paying the tax | Withheld at source from your salary each month, with any balance after the avis d’impôt | April 15, even if you file later |
| Foreign accounts | Accounts outside France are declared with your return | The FBAR, due October 15, filed online |
Foreign tax credit or exclusion: which wins in France?
Usually the foreign tax credit, especially now that CSG and CRDS count toward it. French income tax plus social charges on a salary is normally more than the U.S. tax on it, and the unused credit carries forward for up to 10 years.
- Families can be the exception. The quotient familial can bring French income tax well below the U.S. tax on the same salary. Then the exclusion, up to $130,000 of earned income for 2025, or a mix of both, can do better.
- The refundable child tax credit, up to $1,700 per child for 2025, needs the credit rather than the exclusion, which can tip the choice back.
- Savings that are tax-free in France, like the Livret A, have no French tax to credit, so the U.S. tax on that interest is paid in full.
We run your returns both ways before choosing. How we compare the exclusion and the credit.
A worked example: a family in Lyon
Claire is a U.S. citizen married to a French husband in Lyon, earning €60,000 a year. She has a full Livret A, an assurance-vie of €40,000 invested in funds, and a PEA holding two ETFs. She has never filed a U.S. return.
| Item | How it’s handled |
|---|---|
| Filing status | Married filing separately, so her husband’s income stays off the U.S. return. |
| Salary | French income tax plus CSG and CRDS is higher than the U.S. tax on it, so with the foreign tax credit her U.S. tax on it is $0. |
| Livret A | The interest goes on her U.S. return, with no French tax to credit. |
| Assurance-vie | On the FBAR, and on Form 8938 if she’s over its threshold. We check the contract to decide how its growth and funds are reported. |
| PEA | The two ETFs are PFICs: a Form 8621 for each, in each year filed. |
| Catching up | Three years of returns and six FBARs under the Streamlined procedures, with no penalty if she qualifies. |
Catching up from France
Most Americans in France who fell behind without meaning to can catch up under the Streamlined Foreign Offshore Procedures: three years of returns, six years of FBARs and, if you qualify, no penalties. If only FBARs are missing, or you’ve moved back to the U.S., another route may fit better. See every IRS catch-up option for expats, compared.
Common questions
Is my assurance-vie a problem?
Not necessarily, but it needs the right reporting. We look at what’s inside it and report it correctly on your FBAR, Form 8938 and return.
Can I keep my PEA?
Often, yes, but it may mean extra forms each year. We’ll show you the U.S. cost of keeping it versus moving to U.S.-friendly investments.
Do CSG and CRDS count as foreign taxes?
Yes. The IRS stopped disputing it in 2019, so they count toward the foreign tax credit, and past years you didn’t claim can generally be amended for up to 10 years.
Is my French state pension taxable in the U.S.?
No. Under the treaty, pensions from French social security, both the basic plan and AGIRC-ARRCO, are taxable only in France, even for U.S. citizens.
Do I pay U.S. Social Security tax in France?
Generally not if you pay into the French system. The U.S.-France totalization agreement prevents paying into both systems for the same work in most cases.
My spouse is French. How do we file?
Usually as married filing separately, so your spouse’s income stays off the U.S. return. Filing jointly is possible, but rarely better. Married to a non-American.
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