Our piece on part-time work covers what happens to a UK or Irish paycheck -- PAYE, USC, and why the US tax treaty doesn't exempt local wages. That's about income. It's not the whole picture of what the IRS wants from you once you're actually living and studying abroad, and two separate pieces of it have nothing to do with how much you earn: a reporting requirement tied to the foreign bank account you opened to get paid, and an education tax credit that's still on the table if your school happens to clear one specific bar.

Your foreign bank account might need its own federal report -- even if you owe zero tax on it

If the combined balance across every foreign financial account you hold -- checking, savings, or otherwise -- exceeds $10,000 at any point during the calendar year, you're required to file a Report of Foreign Bank and Financial Accounts (FBAR), submitted on FinCEN Form 114. Per the IRS's own FBAR guidance, this isn't optional once you cross the threshold, and it isn't a per-account test: two accounts that each peak at $6,000 still trigger the requirement, because the $10,000 figure is cumulative across everything you hold.

A few things make this genuinely easy to miss:

  • It has nothing to do with whether you owe tax. A student account holding scholarship money, loan disbursements, or a summer's wages can cross $10,000 with zero taxable income behind it, and the filing requirement still applies.
  • It isn't filed with your tax return. The FBAR goes directly to FinCEN through its BSA E-Filing System, separate from your Form 1040, and the IRS states plainly that it is "not filed with the IRS."
  • The deadline tracks your tax return, but the form doesn't. It's due April 15, with an automatic extension to October 15 -- the same calendar most students already have in mind for taxes, just a different destination.

Form 8938 is a second, separate test -- and the "living abroad" threshold might not actually apply to you

FATCA's Form 8938 is a different form with a different (and much higher) threshold, and the IRS is explicit that filing one doesn't excuse you from the other -- "because of differences in the reporting requirements...you may be required to report the same specified foreign financial assets on both Form 8938 and the FBAR." For an unmarried filer living in the US, the threshold is $50,000 on the last day of the tax year or $75,000 at any time during the year. For an unmarried filer the IRS considers to be living abroad, that jumps to $200,000 / $300,000.

Here's the catch most students skip past: "living abroad," for this purpose, isn't just "I study in another country." The IRS's own test requires your tax home to be in a foreign country and that you've been physically present there for at least 330 full days out of a 12-month period -- the identical Physical Presence Test our part-time-work piece already flags as a real trap for the Foreign Earned Income Exclusion. A student who goes home for a full summer can fall short of 330 days, which technically puts them back under the lower domestic thresholds for that tax year. In practice this rarely changes anything, since most student account balances don't come close to $50,000 either way -- but it's worth knowing which test actually governs your situation rather than assuming the higher "abroad" number automatically applies just because you're enrolled overseas.

A separate question: does your UK or Ireland tuition qualify for a US tax credit?

The American Opportunity Tax Credit (AOTC) and Lifetime Learning Credit both require your school to be an "eligible educational institution" -- and per IRS Publication 970, that status for a foreign school isn't about reputation or accreditation back home at all. It rides on the exact same Title IV eligibility test our FAFSA piece already covers for federal Direct Loans: a foreign institution qualifies only if it's approved to participate in a US Department of Education student aid program. Trinity College Dublin, already confirmed Title IV-eligible under federal school code G06842 in that piece, is a real example of a school where this credit's eligibility test and the Direct Loan eligibility test resolve to the same "yes" -- check any other specific school the identical way, through studentaid.gov's Federal School Code Search, not by assuming from its name or ranking.

One real wrinkle: foreign schools aren't required to issue a Form 1098-T the way a US school is. The IRS allows the credit to be claimed anyway if you can otherwise show the student was enrolled at an eligible institution and substantiate what was actually paid -- so budget for keeping your own tuition payment records if your school doesn't send one, rather than assuming no 1098-T means no credit. Both credits also phase out by income -- for the AOTC, Publication 970 and the IRS's own 2026 instructions put that at a modified AGI between $80,000 and $90,000 for a single filer ($160,000-$180,000 filing jointly) -- and since most undergraduates are claimed as a dependent, it's usually a parent's income being tested against that range, not the student's own.

What this means for you

  • Track your combined foreign account balance across the whole year, not just at tax time -- if it crosses $10,000 even briefly, the FBAR requirement is triggered regardless of your actual tax bill.
  • File the FBAR with FinCEN directly, not with your Form 1040 -- it's a separate electronic filing through the BSA E-Filing System, due April 15 with an automatic extension to October 15.
  • Don't assume the higher "living abroad" Form 8938 threshold automatically applies to you -- it depends on the same 330-day Physical Presence Test that governs other foreign-income tax questions, and a long summer at home can put you back under the lower domestic threshold.
  • Check your specific school's Title IV status before counting on the American Opportunity Credit or Lifetime Learning Credit -- the test is identical to the one that governs federal Direct Loan eligibility, and "no 1098-T" doesn't automatically mean "no credit," just more paperwork to substantiate it yourself.
  • None of this is personalized tax advice -- a tax professional familiar with expat filing is worth the cost once your accounts, income, and credits start overlapping this much.

Sources