Before You Leave the US for Australia: What to Do About Your Super and Your US Accounts

You cannot roll your 401K into Australian superannuation. There is no portability between the two systems. You will manage two retirement accounts in two countries for the rest of your working life.

Emma moved to Sydney when she got married. She asked her Australian financial planner how to transfer her 401K into her super fund. He'd seen this before. The answer: you can't. The US doesn't allow 401K rollovers to foreign retirement plans. The Australian super fund isn't recognized by the IRS as a qualifying retirement plan. She'd have to withdraw the 401K — paying US income tax at ordinary income rates plus potentially a 10% early withdrawal penalty — and then contribute to super from after-tax money. Or she could just leave the 401K in the US.

She left it in the US. That's the right decision almost every time.

Before You Leave the US

401K: leave it

Leave your 401K in the US. Don't cash it out. Don't try to roll it anywhere. The account continues to grow tax-deferred. You'll make distribution decisions at retirement, when you have a clearer picture of which country you're in, what your combined income is, and what the US-Australia treaty says about distributions at that point.

The US-Australia tax treaty has a pension article, but its provisions on US retirement plans are limited. 401K distributions to Australian residents are taxable in the US (at the non-resident withholding rate, potentially reduced by treaty to 15% for periodic payments) and potentially taxable in Australia. The treaty prevents full double taxation but doesn't eliminate the US withholding.

US brokerage: keep it open

Your US brokerage holding US-listed ETFs and stocks is the cleanest vehicle to maintain for investments. Australian-domiciled managed funds (unit trusts) and most ASX-listed ETFs are PFICs for US persons. The PFIC treatment — punitive annual tax on gains at ordinary income rates plus an interest charge — makes Australian-domiciled funds a poor choice for US citizens and green card holders living in Australia.

Contact your US brokerage before you leave and confirm they will maintain accounts for Australian-resident clients. Some US brokerages restrict trading when they identify a non-US address. If your brokerage has this restriction, consider moving to one that serves expats before you leave.

RSU vesting decision

If you have unvested RSUs from a US employer, the US-sourced portion (based on US workdays during the vesting period) remains US-taxable regardless of where you live at vest. Australia will also want to tax RSU income earned during your Australian residency period based on Australian workdays. The sourcing calculation applies in both directions.

Consider selling vested shares before departure to close existing US tax events. For non-citizens, the 30% NRA withholding on US securities sales applies after you become a non-resident. US citizens don't face withholding but still benefit from selling during the resident period if the basis-to-price ratio makes capital gains treatment attractive.

First 90 Days in Australia

Super registration: mandatory, complex

Australian superannuation is mandatory. Your employer must contribute 11.5% of your ordinary time earnings (the Superannuation Guarantee rate as of 2024-25) to your chosen super fund. You don't contribute from gross salary by default — though you can make voluntary contributions.

The US tax problem: Australian super is almost certainly a PFIC under US tax rules. The super fund invests in Australian-domiciled managed funds, which are PFICs. Australian super funds are also arguably foreign trusts, which would trigger Form 3520/3520-A reporting. The IRS has issued limited guidance on superannuation specifically, and the treatment remains unsettled.

In practice, most cross-border CPAs recommend annual FBAR reporting on the super account (it's a foreign financial account) and Form 8621 reporting on the PFIC position. Some practitioners also recommend the Form 3520 foreign trust approach. None of these approaches is definitively settled in IRS guidance. You need a CPA with specific US-Australia cross-border experience.

FEIE election

FEIE is available for US citizens in Australia via the bona fide residence test once you've established Australian residency. For 2026, the exclusion covers up to $132,900 of foreign earned income — your Australian salary from an Australian employer. RSU income from a US employer is not foreign earned income and is not covered.

The FEIE vs. Foreign Tax Credit choice: Australia's income tax rates are comparable to or higher than US rates. Australia taxes residents at up to 47% (including Medicare levy). If your Australian tax exceeds your US tax on the same income, the Foreign Tax Credit is more valuable than the FEIE — you zero out your US liability with Australian credits and pay only the higher Australian rate. Run this calculation with your CPA for your specific income level.

Ongoing Obligations

Form 1040: Annual, as a US citizen or green card holder. Americans in Australia get an automatic extension to June 15.

Australian tax return: Annual, filed by October 31 for most individuals (or later with a tax agent).

FBAR (FinCEN 114): Annual, for the super fund account, any Australian bank accounts, and any other Australian financial accounts above the $10,000 aggregate threshold.

Form 8621 (PFIC): Annual, for the PFIC position in the superannuation fund.

Foreign Tax Credit: Australian income tax paid is creditable against your US liability on Australian-source income. This is the primary mechanism preventing double taxation. The credit calculation requires Form 1116 and accurate records of Australian tax paid.