Broker · Europe
eToro & PFICs for US expats
eToro serves US residents through a separate US entity — US expats on the European platform face the UCITS/PFIC question plus FBAR on the account.
By Danilson Ramos · Founder, Atamatax
Published July 2026 · Updated August 2026
Takes ~2 minutes — then continues into your full free diagnostic.
eToro runs distinct platforms: a US entity for US residents and European/UK entities for everyone else. Which entity holds your account decides most of the US tax analysis.
Which eToro are you on?
US residents are onboarded to eToro USA (a US account — not an FBAR account). A US citizen living in Europe generally can't open a fresh European eToro account as a US person (the onboarding screens for US status — confirm with eToro); the ones who hold European accounts usually opened them before acquiring US status or before the screening tightened.
On the European platform: the PFIC and FBAR questions
| Holding at eToro (EU/UK) | What it is | US filing angle |
|---|---|---|
| European ETFs | UCITS funds | Likely PFIC → Form 8621 each year |
| US stocks (real shares) | Individual shares | Not PFICs; account still reportable |
| Smart Portfolios (copy baskets) | Baskets of instruments | Look through: each UCITS slice is its own PFIC |
| CFD positions | Derivatives on the underlying | Not PFICs, but gains are taxable; account reportable |
| Crypto | Crypto via eToro | FBAR treatment unsettled — flag it |
The European account itself counts toward the $10,000 FBAR aggregate and the Form 8938 thresholds at its maximum and year-end values.
What to export
- The account statement for the year: positions, ISINs where shown, and values.
- Which entity holds your account (it's in your terms/statements) — US vs European changes the analysis.
- Maximum account value during the year for the FBAR.
Check your eToro holdings before you file
Paste your tickers or ISINs — the free checker flags likely PFICs and estimates your Form 8621 workload. Atamatax is tax-preparation software, not a CPA firm, and this is not individualised tax advice.
Authorities cited
- IRC §1291 — IRC §1291 — Interest on tax deferral (excess-distribution regime)
- IRC §1297 — IRC §1297 — Definition of a passive foreign investment company
- IRS Form 8621 — About Form 8621 — Information Return by a Shareholder of a PFIC or QEF
- 31 CFR §1010.350 — 31 CFR §1010.350 — FBAR (FinCEN Form 114) filing requirement and $10,000 threshold
- FinCEN Form 114 (FBAR) — Report of Foreign Bank and Financial Accounts (FBAR)
- IRS Form 8938 — About Form 8938 — Statement of Specified Foreign Financial Assets
Primary sources (Cornell Legal Information Institute for the US Code and CFR; IRS.gov for forms, procedures, and treaty documents). This page is general information, not individualized tax or legal advice.
Atamatax provides tax preparation support and educational resources. This website does not constitute legal or tax advice.