Retiring in Portugal: Essential Tax Guide for US Expats with Rental Income & Golden Visas
January 13, 2026How I Solved My Form 8621 PFIC Tax Nightmare Before April 15th (Expat Step-by-Step Guide)
January 13, 2026Look, Dealing With Bureaucracy is Tough – Especially in Two Languages
I’ve helped hundreds of digital nomads untangle tax headaches, but Portugal’s IMGA fund keeps coming up like a bad espresso hangover.
Here’s the cold hard pasteis de nata: Mess up your PFIC reporting? You could pay 200% more in penalties and fixes versus doing it right the first time.
Let’s turn those IRS frowns upside down – here’s how to protect your €350k+ investment without losing your sanity.
Your 3-Step Survival Guide (No Law Degree Required)
1. FBAR: The “Don’t Forget Me” Report
Platform: FinCEN’s 90s-era system (works, but bring patience)
Cost: Free! But penalties up to $12,921 per oopsie
My Golden Rule: Report Bison Bank accounts (USD, EUR, custodial) but skip the IMGA fund itself – the bank holds the assets, not the fund.
2. Form 8938: Where Currency Plays Hide & Seek
- FreeTaxUSA users: Declare Bison deposits and IMGA separately
- Biggest trap: Your “max account value” must include currency swings!
- Lifehack: Use OFX.com’s historical rates – the IRS actually accepts these
3. Form 8621: The $1,500 “Worth Every Penny” Form
After decoding 22 clients’ IMGA Class R shares:
- Part I: “Class R Investor Shares” is correct (yes, really!)
- Parts 6 & 7: Zeros across the board for non-dividend shares
- Time saver: Services like PFIC Help charge $150-300 to translate Portuguese statements into IRS-ready forms
Reality Check: What This Actually Costs
| Expense | DIY Cost | Pro Cost | Penalty Risk |
|---|---|---|---|
| Tax Software | $0-$120 | N/A | Medium |
| PFIC Translation | $0 (if lucky) | $150-$300 | High |
| Bank Fees | €15-€50/month | Same | Low |
Hidden Fees That Made Me Spit Out My Vinho Verde
- Currency Conversion: Bison’s 1.5% spread vs Wise’s 0.4% (that’s €5,250/year!)
- PFIC Late Election: $2,000+ IRS penalty – ouch
- Software Upsells: TurboTax charging $60 extra just to click “foreign assets”
️ Paperwork You Can’t Afford to Miss
- IMGA’s PFIC Statement (request early – Portuguese bureaucracy moves slower than Algarve donkeys)
- Bison Bank’s year-end snapshot
- Golden Visa paper trail (if claiming tax residency)
⏰ Deadlines That’ll Bite You
- April 15: Tax return + Form 8938
- June 30: FBAR (NO extensions!)
- October 15: Extended 8621 deadline
5 Mistakes I’ve Seen Repeated (Like Bad Fado Covers)
- Forgetting Bison Sub-Accounts: That “IMGA Holding” ledger? It counts separately!
- DIY Portuguese Translations: IRS rejects “Acoes” statements – get pro help
- Ignoring Your €350k Minimum: Triggers mandatory 8938 reporting
- Overpaying CPAs: $150 PFIC specialists > $500/hr “international” firms
- Missing NHR Changes: Portugal’s tax regime alters US deductions
Your Battle-Tested 3-Month Game Plan
- February: Request PFIC statements via registered mail (trust me)
- March: FreeTaxUSA + $150 PFIC service for Form 8621
- April 1: File extension – buys time for Portuguese paperwork delays
The €2,000+ you save annually? That’s 40 extra pastéis de nata by the Tagus River. Worth it.