Topic · Spain
Modelo 720 vs the FBAR and Form 8938: three declarations, no overlap
Americans in Spain routinely assume one covers the other. They are filed with different governments, on different rules, about different things — and doing one has no effect on the other two.
By Danilson Ramos · Founder, Atamatax
Updated August 2026
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An American living in Spain is inside two asset-reporting regimes at once, and they mirror each other in a way that makes them easy to confuse. Spain wants to know about the assets you hold outside Spain. The United States wants to know about the accounts and assets you hold outside the United States. The same person, the same portfolio, and two governments asking near-opposite questions.
What each one actually is
| Modelo 720 | FBAR (FinCEN 114) | Form 8938 | |
|---|---|---|---|
| Filed with | Agencia Tributaria (Spain) | FinCEN (US Treasury) | IRS, attached to Form 1040 |
| Asks about | Assets and rights located outside Spain | Financial accounts located outside the US | Specified foreign financial assets |
| Covers | Accounts, securities, immovable property, and certain other assets | Accounts only | Assets, including some without an account |
| Real estate? | Yes | No | Generally no, when held directly |
| Who files | Spanish tax residents | US persons | US persons meeting the threshold |
| Relationship to the tax return | Separate informative declaration | Separate — not part of the return | Part of the return |
The consequence people miss
A US citizen who moves to Spain and keeps a US brokerage account has a new Spanish declaration to think about that has nothing to do with the IRS. A US citizen in Spain who opens a Spanish current account has a new US report to think about that has nothing to do with the Agencia Tributaria. Most people notice one of these and assume it was the whole obligation.
Where the US side actually bites
Modelo 720 is an informative declaration: it reports, it does not itself tax. The US reporting forms are also informative — but the underlying US position is not, and this is where an American in Spain typically finds the real cost. Spanish investment funds and European ETFs held through a Spanish bank are non-US pooled vehicles that commonly meet the PFIC tests, so the same holdings that generate a line on Modelo 720 can generate a Form 8621 on the US return.
- FBAR. Spanish current accounts, savings accounts and brokerage accounts count toward the $10,000 aggregate — measured as the maximum during the year, across every non-US account you hold anywhere.
- Form 8938. The same accounts, plus certain assets without an account, count toward the specified-foreign-financial-asset thresholds ($300,000 for a single filer abroad at any point in the year).
- Form 8621. Generally one per PFIC per year for Spanish or European funds held in a Spanish account.
- Foreign Tax Credit. Spanish income tax paid on the same income is what makes the US credit available — see the France and Spain desks for how the treaty allocates each income type.
The 2022 CJEU ruling, and what it did not change
Modelo 720's original enforcement regime was aggressive: penalties without a limitation period, and undeclared assets treated as unjustified capital gains. In January 2022 the Court of Justice of the European Union held in Commission v Spain (C-788/19) that this regime was contrary to EU law, and Spain amended it.
What survived is the declaration itself. The obligation to file Modelo 720 was not struck down — only the disproportionate consequences of failing to. Reading the ruling as having abolished the declaration is a common and expensive misunderstanding, and it says nothing at all about the US forms, which the CJEU has no jurisdiction over.
Working out what you owe to whom
- List every account and asset you hold, and tag each one by the country it is located in.
- For Spain: identify what is located outside Spain — including US accounts, US property and US retirement accounts.
- For the US: identify what is located outside the US — including every Spanish account, whatever its balance.
- Take the maximum value of each non-US account during the calendar year and total them against the $10,000 FBAR figure.
- Separately test the Form 8938 thresholds, which are different numbers on a different measurement basis.
- List every pooled fund in a Spanish account with its ISIN, because that is where the US tax rather than merely the US reporting is decided.
See which US thresholds you actually cross
Enter your account values and the free checker shows whether you cross the FBAR line, the Form 8938 line, both, or neither — with the reasoning shown.
Authorities cited
- AEAT · Modelo 720 — Agencia Tributaria — Modelo 720, informative declaration of assets and rights held abroad
- CJEU C-788/19 — Court of Justice of the European Union, Commission v Spain (C-788/19, 27 January 2022) — Modelo 720 penalty regime held contrary to EU law
- 31 CFR §1010.350 — 31 CFR §1010.350 — FBAR (FinCEN Form 114) filing requirement and $10,000 threshold
- 31 U.S.C. §5314 — 31 U.S.C. §5314 — Statutory basis for the FBAR (foreign financial account reporting)
- FinCEN Form 114 (FBAR) — Report of Foreign Bank and Financial Accounts (FBAR)
- IRS Form 8938 — About Form 8938 — Statement of Specified Foreign Financial Assets
- IRC §6038D — IRC §6038D — Information reporting of specified foreign financial assets (Form 8938)
- 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
- US–Spain Income Tax Treaty — Convention between the United States and Spain (signed 1990), as amended by the 2013 Protocol (in force 2019)
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.
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