Swiss Vested-Benefits (Freizügigkeit) & US Tax

Swiss vested-benefits (Freizügigkeit) accounts & U.S. tax

When you leave a job or Switzerland, your 2nd-pillar can move to a vested-benefits account — here's the U.S. reporting and the PFIC angle.

By Danilson Ramos · Founder, Atamatax

Updated July 2026

Tax review partner: onboarding in progress. This article has not yet been independently reviewed by a credentialed professional — every figure cites its IRS source so you can verify it directly.

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A vested-benefits account (Freizügigkeit / libre passage) holds your 2nd-pillar assets when you leave an employer or Switzerland without immediately transferring into a new pension. For a U.S. person it raises the same two questions: reporting, and whether it holds PFICs.

Reporting

Generally a reportable foreign account — on the FBAR if combined non-U.S. accounts exceed $10,000 at any point.
And on Form 8938 if you cross the higher abroad thresholds.

The PFIC angle

Vested-benefits accounts come in two flavours — an interest-bearing (bank) account, or an invested one holding funds. An invested vested-benefits account holds non-U.S. funds, so those are generally PFICs needing Form 8621. An interest-only one has no PFIC.

Same rule as the 3a: cash / interest = no PFIC; invested in non-U.S. funds = PFICs, each needing Form 8621.

Check your reporting and your funds

See whether you cross the FBAR and Form 8938 thresholds, then check any funds for PFICs. Atamatax is tax-preparation software, not a CPA firm, and this is not individualised tax advice.

Check my thresholds

Pension rules and account structures vary — confirm the specifics with your provider. Atamatax provides preparation software and educational estimates, not individualised tax, legal, or investment advice.

Authorities cited

FinCEN Form 114 (FBAR) — Report of Foreign Bank and Financial Accounts (FBAR)
31 CFR §1010.350 — 31 CFR §1010.350 — FBAR (FinCEN Form 114) filing requirement and $10,000 threshold
IRS Form 8938 — About Form 8938 — Statement of Specified Foreign Financial Assets
IRS Form 8621 — About Form 8621 — Information Return by a Shareholder of a PFIC or QEF
IRC §1297 — IRC §1297 — Definition of a passive foreign investment company

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.

Frequently asked questions

Do I report a vested-benefits account on the FBAR?

Yes, if your combined non-U.S. financial accounts exceeded $10,000 at any point in the year, and on Form 8938 if you cross the higher abroad thresholds.

Is a vested-benefits account a PFIC?

If it's invested in non-U.S. funds, those funds are PFICs for a U.S. person and need Form 8621. An interest-only (bank) vested-benefits account holds no funds, so no PFIC.

What happens to my 2nd pillar if I leave Switzerland?

It can move to a vested-benefits account. While you remain a U.S. person, the U.S. reporting continues; confirm the specifics of your account with your provider.