American in Luxembourg: residence, US taxes and banking
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Practical guide · trigger.lu
American in Luxembourg: residence, US taxes and banking
- When
- before any residence step
- You need
- dated and signed contract
- CV
- diplomas
Details
Salary of at least €65,652 gross per year and a higher-education degree: you apply for the EU Blue Card. Below that, it's the "salaried worker" permit. Your employer must then declare the vacancy to ADEM and obtain a certificate allowing it to hire you, if ADEM finds no suitable local candidate (from a few working days to several weeks).
- Where
- Washington, New York or San Francisco, depending on your state
- Cost
- $55 (fee schedule of the embassy in Washington)
- You need
- valid passport
- criminal record extract less than 3 months old
- employment contract
- long-stay visa form
Details
An American is a third-country national: they enter without a visa as a tourist, not to settle. The D visa replaces the former temporary residence authorisation. You submit it yourself, and an application made from Luxembourg is inadmissible. It is valid for 6 months. If you already live in another country, you can also apply at the Luxembourg (or Belgian) embassy or consulate in that country of residence. The details are in our guide residence permit and work permit outside the EU.
- Deadline
- 3 days after you arrive
- You need
- passport with the D visa
- lease if you have it
Details
No legal address, no residence permit.
- When
- as early as possible
- Where
- a general practitioner in Luxembourg, then a tuberculosis screening
- When
- at the latest 3 months before the D visa ends
- Cost
- €80 on approval
- You need
- full copy of your passport
- arrival declaration
- proof of housing
Details
Once approved, go to the Directorate of Immigration for the photo and fingerprints: your card is ready one week later.
This is for you if
- You have US citizenship and a job offer in Luxembourg, or you've just arrived.
- You have a green card: for the IRS, you are also still a "US person". For residence, your nationality is what counts: depending on your passport, a visa may be required even for a short stay.
- Your spouse and children are coming with you: they also apply for a D visa, in the "family member" category.
This is not for you if you also have a European Union (EU) passport: you settle as a European, without a D visa, but your US tax obligations stay the same. Luxembourg citizenship by descent is a separate topic, which we will cover separately.
Key figures
| Item | Value | Year or date |
|---|---|---|
| Visa-free stay in the Schengen area | 90 days in 180 | 2026 |
| D visa mandatory to settle | For every non-EU national | Since 1 October 2026 |
| D visa validity | 6 months | 2026 |
| D visa fee | $55 | Fee schedule of 11 June 2024 |
| Residence permit | €80 | 2026 |
| EU Blue Card threshold | €65,652 gross per year | Since 3 March 2026 |
| Foreign earned income exclusion (FEIE) | $132,900 per year | 2026 income |
| FBAR threshold | Over $10,000 in total, at any point in the year | 2026 |
| Form 8938 threshold (living abroad, single) | $200,000 on 31 December or $300,000 at any point | 2026 |
| Licence exchange | €30, within the year | 2026 |
Your US taxes carry on
The United States taxes its citizens, wherever they live. So you file your federal return (Form 1040) for every year in which your worldwide gross income reaches the threshold for your situation (Publication 54, income excluded under the FEIE included), on top of your Luxembourg return. For your specific case, check IRS, filing requirements for Americans abroad (ouvre dans un nouvel onglet). As a resident, you are also taxed in Luxembourg on your worldwide income (see the tax classes).
Deadline: 15 April, or 15 June if you live abroad. But interest on the tax due runs from 15 April.
To avoid paying twice, you choose between two tools:
- the foreign tax credit (Form 1116): the tax paid in Luxembourg reduces your US tax on the same income;
- the foreign earned income exclusion (FEIE, Form 2555): up to $132,900 of salary excluded for 2026.
Not both on the same income. The right choice depends on your situation: have it checked by a tax adviser who knows both countries.
The Luxembourg - United States tax treaty (1996, amended in 2009) allocates the right to tax. It leaves the United States the right to tax its citizens: it does not exempt you from filing.
FBAR and FATCA, explained
FBAR: if your accounts outside the United States exceed $10,000 in total at any point in the year, you report them to the US Treasury (FinCEN, Form 114). Online, free, before 15 April, automatic extension to 15 October. It is not a tax.
FATCA: this US law has two effects:
- your Luxembourg bank passes your account data to the Luxembourg tax authority, which sends it to the IRS (agreement of 28 March 2014);
- you attach Form 8938 to your return above the thresholds in the table.
Your bank in Luxembourg
With FATCA, every account held by a "US person" creates work for the bank. Some therefore refuse Americans, especially for savings and investments.
To prepare:
- Keep your US Social Security number (SSN) handy: the bank asks you for a W-9 form.
- First open a current account for your salary.
- Before buying a European investment fund, get advice: the US tax authority often treats it as a "PFIC", with a heavy regime (Form 8621).
If you legally reside in the EU, the law of 13 June 2017 gives you the right to a basic payment account. The large banks designated by the CSSF, the financial regulator, must reply within 10 working days. Unjustified refusal: you can refer the matter to the CSSF. For everything else, read our guide managing your money in Luxembourg.
Your US driving licence
The United States signed the 1949 Geneva Convention on Road Traffic. Your licence can therefore be exchanged for a Luxembourg licence, without a test for a car (category B), for €30 at the SNCA (Société nationale de circulation automobile).
You can drive with your US licence for one year after settling. The exchange takes effect after at least 185 days of residence, if you lived at least 6 months in the state that issued your licence. Your licence must still be valid: if it has expired, you must take the test, and a Luxembourg resident cannot have it renewed in the United States.
Emily's example
Emily, 31, a data analyst in Chicago, signs a contract in Luxembourg City in June 2026 at €72,000 gross per year.
- €72,000 exceeds €65,652: she aims for the EU Blue Card.
- In August, she submits her D visa at the competent consular post: $55.
- She arrives on 1 November, registers at the commune on the 3rd, takes the medical check and applies for her residence permit: €80.
- On 31 December, she has €11,000 in her Luxembourg accounts, i.e. more than $10,000: FBAR mandatory for 2026, but no Form 8938.
- In 2027, she files in both countries, with a tax adviser to choose between the tax credit and the FEIE.
- Before 1 November 2027, she exchanges her Illinois licence: €30.
Common mistakes
- Arriving without a D visa to sort it out on the spot: the application is inadmissible, it must be submitted before arriving, in the United States or in your country of residence.
- Stopping filing with the IRS: a missed return or FBAR can cost heavy penalties.
- Combining the tax credit and the FEIE on the same income: it's not allowed.
- Buying a European fund without checking the PFIC regime: US tax can eat up the return.
- Forgetting to exchange your licence within the year: your US licence is no longer valid in Luxembourg and you have to pass a theory and a practical test.
Frequently asked questions
Yes. Beyond 90 days, you need a D visa, requested in the United States before leaving. For tourism under 90 days, no visa.
Yes, every year, on your worldwide income. The foreign tax credit or the FEIE in principle prevent double taxation.
A report of your foreign accounts to the US Treasury, mandatory above $10,000 in total. It is not a tax.
Because of FATCA, which requires it to report the accounts of "US persons". You keep the right to a basic payment account.
Yes, for one year. After that, it must be exchanged (€30, without a test for a car).