Form 8938 for married couples filing separately

Which Form 8938 threshold applies when you file separately from the UK

The threshold for a taxpayer living abroad who does not file a joint return. For tax year 2025 that is $200,000 at year end or $300,000 at any time, the same figures an unmarried person abroad uses. The joint figure of $400,000 at year end or $600,000 at any time is available only on a joint return.

Living abroad has a defined meaning. The IRS page Do I need to file Form 8938 (opens the official IRS page in a new tab) gives two routes: a US citizen whose tax home is in a foreign country and who is a bona fide resident there for an entire tax year, or a US citizen or resident present in a foreign country for at least 330 full days in a twelve-month period ending in the tax year. Most Americans settled in the UK meet the first. A recent arrival may need the second, or fall back to the lower US threshold.

One precondition is easy to overlook. The instructions say that a person with no income tax return to file for the year has no Form 8938 to file. For married filing separately, though, the gross income threshold for a return is $5, as Publication 54 (opens the official IRS page in a new tab) sets out, so almost any American in Britain with a bank account paying interest has a return and therefore faces the Form 8938 test.

• Filing separately and living abroad: $200,000 at year end or $300,000 at any time
• Filing jointly and living abroad: $400,000 at year end or $600,000 at any time
• Filing separately and treated as living in the US: $50,000 at year end or $75,000 at any time
• No income tax return required for the year: no Form 8938 required

How a joint asset counts when your spouse is British

In full. The instructions say that where the other joint owner is a spouse who is not a specified individual, each joint owner includes the entire value of the jointly owned asset when working out whether the threshold is met. A British spouse with no US citizenship, no green card and no election to be treated as a US resident is not a specified individual, so the joint account counts at its whole value towards your total.

The same rule works in your favour on the other side of the marriage. An asset that belongs to your British spouse alone does not enter your calculation at all. In an IRS example of a couple living abroad and filing separately, where the spouse is not a specified individual, the filer counts the joint asset in full and their own separate asset, and the spouse's separate asset is left out. Accounts on which you merely hold a mandate are an FBAR question, covered in our post on FBAR for joint accounts with a non-US spouse.

The practical consequence is that moving money between a joint account and your spouse's sole account can change your Form 8938 position, while it changes nothing on the FBAR, where a joint account is reported in full whoever owns it. Our post on what counts as a specified foreign financial asset covers which holdings are in scope before any of this counting begins.

• Joint account with your British spouse: counted at its whole value
• Account or investment in your sole name: counted in full
• Account or investment in your spouse's sole name: not counted
• UK property owned directly by either of you: not a Form 8938 asset

How a joint asset counts when both spouses are American

Half each. Where both spouses are specified individuals and file separate returns, the instructions tell each spouse to include one-half of the value of the asset owned jointly with the other when testing the threshold. Each spouse then adds the assets in their own sole name and compares the total with their own threshold.

Because each test is personal, the outcome can differ between the two. An IRS example of a separately filing couple in the US shows one spouse required to file and the other not, because the spouse with more in their sole name crosses the line once half the joint asset is added, while the other does not. The same arithmetic applies abroad at the higher figures.

This is also where the choice between separate and joint returns has a Form 8938 effect. On a joint return a jointly owned asset is counted once against the joint threshold, which is double the separate one. Filing status is usually settled by income tax rather than by Form 8938, and our post on filing status for Americans married to a non-US spouse sets out the wider trade-offs.

Why the form shows the full value of a joint asset

Because counting and reporting are separate steps. Half a joint asset may be what you count towards the threshold, but once you are required to file, the instructions say both spouses filing separate returns include the maximum value of the entire asset on their own Forms 8938, not their share.

So two American spouses who both cross the threshold each list the same joint account at its full maximum value. The IRS is not double counting. It is asking each person to describe every asset in which they have an interest. Part V of the form also has a box to show that an account was jointly owned with your spouse, so the joint holding is identified as such on each return.

The full value convention matches the FBAR, where each US owner of a joint account also reports its whole highest balance. Using one schedule of year-end and maximum values for both reports, converted at the Treasury year-end rate, keeps the figures on the FBAR, Form 8938 and Schedule B of Form 1040 consistent. The IRS comparison of Form 8938 and FBAR requirements (opens the official IRS page in a new tab) shows where the two reports differ in scope.

Does one spouse's Form 8938 cover the other

Only on a joint return. Married couples filing jointly file a single combined Form 8938 with that return. On separate returns there is no combined form: each spouse who meets the threshold attaches their own Form 8938 to their own return, reporting joint assets at full value and their sole assets in full.

This differs from the FBAR. Two spouses who are both US persons can sometimes file one FBAR between them, where every account the other spouse must report is jointly owned and both have signed the consent on Form 114a. Form 8938 has no equivalent for separate filers. The IRS basic questions on Form 8938 (opens the official IRS page in a new tab) also confirm that filing Form 8938 does not replace the FBAR, which goes to FinCEN (opens the official FinCEN page in a new tab) on its own timetable.

A British spouse files nothing. Without the election to be treated as a US resident they have no US return, so no Form 8938 arises for them. If the couple make that election to file jointly, the British spouse becomes a specified individual, their worldwide income enters the US return, and their sole assets join the joint Form 8938, so the threshold doubles but the asset base grows too.

A worked example and a filing checklist

A US citizen who teaches in Bristol has lived in England for many years and files separately from her British husband. They hold a joint savings account and a joint general investment account. She has a workplace pension in her own name. He has a stocks and shares ISA and a savings account in his sole name, and she has no signature authority over either.

Her test starts with the joint accounts at their whole value, because he is not a specified individual. She adds her pension. His ISA and savings account stay out. The joint accounts alone sit below $200,000 at year end or $300,000 at any time, but with the pension added her year-end total crosses the lower of those two figures, so she files. Each joint account goes on her form at its full maximum value, and the pension goes on in full.

Had her husband been an American filing separately, she would have counted only half of each joint account, and her total might have stayed under the threshold. He would then have tested his own position. Whichever of them crossed it would have reported the joint accounts at full value. We prepare these returns through our individual tax return service and the reports through our foreign income and FBAR reporting service.

• Confirm you have a US return to file for the year
• Check you meet the bona fide residence or physical presence route for the abroad threshold
• Establish whether your spouse is a specified individual
• Count joint assets in full or by half accordingly, plus your sole assets
• Compare the year-end and highest values with the threshold for separate filers abroad
• If you file, enter every joint asset at the value of the whole asset

Mistakes we see with separate returns

The errors run both ways. Some separate filers use the joint threshold because they are married and omit a form they needed. Others halve a joint account held with a British spouse, or add that spouse's sole ISA and file a form that was never due.

The consequences of getting it wrong are set out in our post on Form 8938 penalties and the open statute of limitations. For separate filers the point to hold on to is that each spouse's position is measured alone, and a gap on one return is not cured by a complete form on the other. Our page on Form 8938 and the FinCEN Form 114 page describe the two reports, and the full framework sits in our guide to FBAR and FATCA for UK residents.

• Applying the joint threshold on a married filing separately return
• Halving a joint account held with a spouse who is not a US person
• Adding a British spouse's sole accounts to your own total
• Entering only your half of a joint asset on the form
• Assuming an American spouse's Form 8938 covers you