Cryptocurrency Abroad: Reporting for US Expats

US expats who hold cryptocurrency face the same IRS rules as US-based holders — crypto is treated as property, gains are taxable as capital gains, and transactions must be reported. One additional question for expats is whether crypto held on foreign exchanges counts as a "foreign financial account" for FBAR purposes — the IRS and FinCEN have not issued final guidance on this, but FinCEN proposed rules in 2021 suggesting that cryptocurrency on foreign exchanges could trigger FBAR reporting. If your crypto is held in a foreign exchange and exceeds the FBAR threshold of $10,000 at any point in the year, it's safest to report it until clearer rules emerge. Form 8938 reporting for foreign financial assets above its higher threshold may also apply depending on the total value. The rapid changes in crypto regulation globally mean expats should stay current with both IRS guidance and the rules of the countries where they hold and transact crypto.