Portfolio Software for Advisors to US Citizens Abroad: PFIC, FBAR, Form 8938 and Cost in Two Currencies

Published 31 October 2026 by Steffan Kharmaaiarvi, founder

A US citizen living in Toronto, London or Sydney is taxed by two countries on the same portfolio, and most portfolio software assumes the opposite: that a foreign client is a non-resident alien who should file a W-8BEN and might save tax with Irish funds. For a US person both assumptions are wrong, and the advice that suits a local client can create years of extra US filings. This note is for advisors whose clients include US citizens and green-card holders living abroad: the questions those reviews raise, what Borderfolio for Advisors screens, a worked example and where it stops. The figures are screening estimates for professional review, not tax advice.

Who it is for

Advisors in Canada, the UK, Australia and elsewhere whose clients include US citizens, green-card holders and "accidental Americans" born in the US, and cross-border advisors whose US clients have moved abroad. Borderfolio is a review and cross-border intelligence layer that works beside the client's US tax preparer and your existing systems. It is not a CRM or a tax-preparation tool, and it never recommends or trades.

The questions a review of a US person raises

• Which funds are likely PFICs? Funds domiciled outside the US usually are, and each generally means a Form 8621 every year.
• Is an FBAR due? When the accounts held abroad exceed USD 10,000 in aggregate at any time in the year.
• Is a Form 8938 due? The thresholds depend on filing status and on whether the client lives abroad.
• Does the local wrapper protect anything? Some foreign wrappers are recognised by treaty; others are taxed as ordinary accounts by the US.
• What is the gain in each currency? The same sale can be a gain in local currency and a loss in US dollars.
• Which usual screens do not apply? W-8BEN, the non-resident estate-tax threshold and the Irish-fund saving all assume a non-US person.

What Borderfolio screens for a US person

US persons abroad are one of the situations covered in depth; countries and coverage lists what that includes. A client whose residence is the United States, whose citizenship is American or who is flagged as a US person gets these findings instead of the non-resident ones:

• Why the non-resident screens are omitted. One finding explains it: W-8BEN does not apply to a US person, nor does the USD 60,000 non-resident estate-tax threshold, and an Irish fund creates PFIC exposure rather than a saving.
• PFIC screen. Funds domiciled outside the US, read from the ISIN and instrument type, are listed as likely PFICs, with the likely number of Form 8621 filings and their share of the portfolio. Holdings that cannot be classified are listed separately. See PFIC screening for US clients abroad.
• FBAR and Form 8938. Accounts at brokers outside the US are added up in USD at their highest value so far this year and compared with the FBAR threshold (over USD 10,000) and the Form 8938 thresholds: living abroad, USD 200,000 at year end or USD 300,000 at any time for a single filer, USD 400,000 or USD 600,000 filing jointly; living in the US, USD 50,000 or USD 75,000 single and USD 100,000 or USD 150,000 joint. Brokers with both US and non-US entities are listed for checking against the statement. See FBAR and Form 8938 thresholds.
• Foreign wrappers. An RRSP and a UK pension defer US tax by treaty; an ISA or a TFSA is not tax-free in the US. See cross-border findings.
• Cost basis in two currencies. Each holding in taxable accounts is costed from the confirmed transactions, each trade at its own date's exchange rate, twice: in USD, first in, first out, account by account, and under the residence's rule (Canada's average cost, the UK's Section 104 pool, Australian parcels). Holdings with a gain in one currency and a loss in the other are flagged.
• US retirement accounts in Canada. A traditional IRA is a foreign retirement arrangement; a Roth IRA needs a one-time treaty election by the filing due date of the year residence started. See portfolio software for financial advisors in Canada.

A worked example

Illustrative round figures, not a real client. A single US citizen lives in Canada.

• Two currencies. In a taxable account they bought 100 units of a US-listed ETF at USD 100 when USD 1 was CAD 1.25: a cost of USD 10,000, or CAD 12,500. Today the units are worth USD 95 each and the rate is 1.40: USD 9,500, or CAD 13,300. The US sees a USD 500 loss; Canada sees a CAD 800 gain. The holding is flagged before anything is sold.
• A PFIC in a TFSA. Their TFSA holds a Canadian-listed world equity ETF. For the US it is a likely PFIC, one likely Form 8621 a year, and the TFSA does not make it tax-free in the US.
• FBAR and Form 8938. Their accounts at Canadian brokers reached USD 180,000 at their highest this year. That is over USD 10,000, so an FBAR is due; it is under both Form 8938 thresholds for a single filer abroad, so that form is not triggered by these accounts.

What it does not do

• US tax itself is not computed: no returns, no PFIC tax or QEF and mark-to-market elections, no state tax.
• Bank accounts, foreign pensions and assets outside the brokerage accounts on file are not included in the FBAR and Form 8938 totals, and can change the answer.
• The US wash-sale rule is not applied.
• US-person status is your entry, and nothing is filed.
• It does not recommend, rebalance or trade. The cross-border documentation lists every limit.

How it fits beside your existing systems

Borderfolio for Advisors is a cross-border intelligence layer, not a replacement for your CRM, platform, back office or planning software. Client data reaches it in two ways today. Brokerage statements are uploaded as PDF, CSV, XLSX or images: exports from 15 brokers are read by format-specific parsers, other statements go through an extraction model, and every import is reviewed before anything is confirmed (importing statements). Accounts at Interactive Brokers (Flex) and Freedom24 can instead be connected to the broker's read-only API; synced holdings land unconfirmed and go through the same review (connect a broker). Connections to adviser systems such as Intelliflo and NDEX are in development and are not live.

The client's US tax preparer stays the authority on US filings; Borderfolio gives you and them the same screened view, and a client-ready PDF built from a stored snapshot, with your commentary in its own section (reports).

Frequently asked questions

Does Borderfolio prepare Form 8621 or compute PFIC tax?

No. It lists likely PFICs, counts the likely Form 8621 filings and shows their share of the portfolio. Elections, the PFIC tax and filing exceptions are for the client's US tax adviser.

Which FBAR and Form 8938 thresholds does it use?

FBAR: over USD 10,000 in aggregate at any time. Form 8938 for a filer living abroad: USD 200,000 at year end or USD 300,000 at any time single, USD 400,000 or USD 600,000 joint; living in the US, USD 50,000 or 75,000 single and USD 100,000 or 150,000 joint.

Does the US recognise an ISA or a TFSA?

Not as tax-free. An RRSP and a UK pension defer US tax by treaty; an ISA or a TFSA is treated as an ordinary account by the US.

Why does Borderfolio not suggest a W-8BEN or Irish funds for a US person?

A W-8BEN is for non-US persons. For a US person an Irish fund is a likely PFIC rather than a saving, so the non-resident screens are replaced with one finding explaining why.