New Zealand KiwiSaver: IRS Reporting for US Expats

KiwiSaver is New Zealand's voluntary workplace-based retirement savings scheme, where employees can contribute between 3% and 10% of gross wages, with employer contributions of at least 3% and an annual government contribution for eligible members. The IRS treats KiwiSaver as a foreign pension plan rather than a tax-qualified account, so contributions and earnings are not tax-deferred for US purposes. Employer and government contributions to your KiwiSaver account may be treated as taxable compensation on your US return in the year they are made. The underlying KiwiSaver funds, which are managed investment schemes, almost certainly qualify as PFICs, making gains and distributions subject to the harsh PFIC excess distribution rules. KiwiSaver accounts must be reported on FBAR if aggregate foreign account balances exceed $10,000, and on Form 8938 if the individual account value crosses the higher Form 8938 thresholds.