American Citizens Abroad – Helping expats with SDFCU



American Citizens Abroad

American Citizens Abroad (ACA) is a great non-profit organization that helps US citizens living and working in foreign countries. I'll say right off the bat…no, they are not paying us! It's just that in our firm, we deal with people every day who are affected so negatively by laws like FATCA. We see how much having to worry about the IRS and other issues can wreak havoc on those trying to earn a living overseas.


It's our goal to assist as many of these people as we can, and the ACA does just that. They help with simple things that those living on US soil may take for granted, like banking, voting, getting Medicare, healthcare, or social security. They help with more complicated matters like taxation, and reporting compliance for FATCA and FBARs. They also actively work with the US government to try to better the policies and systems in place.


Expats and Banking Issues

We've talked extensively in the past about expat issues; double taxation, reporting requirements, and most recently passport revocation for unpaid tax bills. Lately, we've heard that more and more people are having issues getting bank accounts, thus causing major headaches. The ACA heard about this and decided to take action. This is where SDFCU comes in.


What does SDFCU stand for? SDFCU = State Department Federal Credit Union.

We spoke with Charles Bruce from the ACA, and asked him why they decided to partner with the Credit Union to address the issue. He said,


"Because our members, overwhelmingly Americans residing outside the US, are being 'locked out'/turned away from US banking services by financial institutions like banks and brokerage houses. This is especially true where the individual does not have a US residence or even mailing address.


The reasons are traceable to securities law regulatory problems, typically in the foreign jurisdiction, and, to some degree, FATCA.


To work around the problem, people were twisting themselves in a knot – creating a US LLC or stretching the truth about having a mailing address with a brother-in-law in California or doing something else expensive or sketchy. What was needed was a straightforward, totally proper and easy solution."


Ok, so what IS it?

SDFCU is a federally chartered credit union, very similar to a bank. Credit unions are a great banking option for anyone; there are currently 103 million members of Federal Credit Unions in the United States. They have checking and savings account services, loans, and other similar financial services to banks.


The SDFCU has been around for a long time; it was created in 1935 to provide financial services to US Department of State employees. They currently have about 67,000 members in just about every country in the world. What's great about ACA's partnership with them is that you don't have to be a State Department employee to join!


At least a little simplicity

Expats experience so many issues that you and I may not think about on a day to day basis. Having an account with the SDFCU is one thing that can be done to simplify their lives. Some of the benefits:


  • The account can be opened even if you live abroad
  • This is a US account, not a foreign account
  • The account does not have to be reported on an FBAR form
  • The account does not have to be reported on Form 8938
  • The account does not count towards the aggregate amount of your foreign accounts for reporting requirements
  • You can do mobile and online banking from your residence, even if it's outside of the US
  •  You can open the account entirely online, which takes about 10-15 minutes


You can check out their Frequently Asked Questions page for information about fees, loans, mortgages, college loans, currencies, non-US spouses and children, and more. To join SDFCU you have to come through an affiliated or introducing group, like the ACA. Get more information about joining the ACA here.


If you have any tax or compliance issues, contact us to set up a free, confidential consultation. You can learn more about our services and fees here.