A growing number of American expatriates and other non-US residents are receiving unwelcome news: their US-based Individual Retirement Accounts (IRAs) are being forcibly closed.
If you are affected by a 401k / IRA account closure and the clock is ticking towards a dreaded deadline, we can help you.
In fact, it can take only a week from start to finish, even for those under the wire, to open and commence a transfer to our US pension custodian.
The decision by large financial organisations to offload their non-resident client accounts highlights a significant shift in the financial services industry. The complexities of cross-border financial regulations, including anti-money laundering (AML) and know-your-customer (KYC) rules, have made servicing these accounts a costly and high-risk endeavour for many mainstream US brokerages.
Examples we have seen of closures:
- Wells Fargo Advisers, through 2024 and 2025, took a core business decision to transition away from non-resident clients.
- UBS, in summer 2025, began a transition away from servicing non-US residents with 401 (k) s and IRAs.
Some of the largest US brokerages have announced that they are not taking on any new non-resident clients or that they are closing existing non-resident accounts. While those who have already made the move to a new IRA custodian that specialises in US expats and non-US residents may not be affected immediately, the longer you wait, the greater the risk of being affected by your old provider closing the door on you.
Reasons for closure of IRA / 401k for non resident
- Increasing regulations, compliance, and risk, many banks and brokerage firms are offloading clients who are not US residents.
Your Options When Facing an IRA Closure
Let’s start with the facts: the key fact is that you do not have that much time. The second key fact is that you can complete the process in plenty of time with the right help and guidance, as well as having the proper documents.
Get a new IRA set up and do a rollover to that account before the deadline. The documents and forms you will need to provide for a quick turn-around on an account opening are few and simple. You should have most, if not all, of them already:
1. An IRA bank or brokerage statement for the last three months.
2. A current foreign address, like a recent utility bill or bank statement.
3. A passport or other valid identification.
The good news is that most of the forms can be signed electronically, and with electronic signatures, an account can be opened in 24-48 hours.
After the account is opened, the assets in your old IRA can be transferred to the new IRA via an electronic account transfer, or ACAT. The average time for the ACAT process is approximately one week. There is one wrinkle, though: if your current provider is not on the ACAT network, a paper-based account transfer will need to be arranged, which will take longer. Also, some mutual funds may not be easily transferable from your current account to your new IRA and may have to be sold first. However, selling investments in an IRA is not a taxable event.
401k rollovers are similar. In many cases a request to the 401k plan provider, generally by phone, is all that is required. Opening an IRA in advance will guarantee there is a place for the rollover funds to go. If the check is made payable to the new IRA custodian for the benefit of (FBO) the client, there is no tax due on the rollover.
Getting a cheque from a 401k rollover
Most 401(k) plans will mail out a distribution check to the address of record, but can be persuaded to mail it directly to the new IRA custodian. As long as the check is made payable to the new IRA custodian FBO (for the benefit of) the 401(k) account holder, the distribution is not taxable.
The bottom line is that if you don’t move the funds to another qualified retirement account within 60 days of the distribution, the entire amount is taxable as a distribution. If you are under age 59 ½, you will pay a 10% early distribution penalty in addition to federal and possibly state income taxes, which could take a substantial chunk of your retirement savings.
The prudent course of action is to switch to a platform designed to serve American expats and non-US residents now, before your account is targeted. That way you won’t have to worry about what to do if you get a letter saying your account is being closed due to your non-US residency.
Meet with Our Team Today
To discuss your situation further, we recommend that you reach out to us as soon as possible to have a no-obligation, no-pressure meeting with our financial team to discuss your unique situation in detail.