US Taxes While Living in Brazil: The No-Treaty Guide

Most Americans who move to Brazil expect a tax treaty to be waiting for them — the way the US has agreed with dozens of other countries on who taxes what. They go looking for that treaty, and it is not there.

This guide explains, in plain English, how to live as a US citizen or green-card holder in Brazil when no income tax treaty exists. It walks through the relief tools US law does provide, the Brazilian obligations that arrive monthly and annually, and recent legislative changes that raise the stakes for anyone holding foreign companies or assets. This is educational content prepared by our cross-border team for Americans in Brazil and the families coordinating from both sides.

Is there a US–Brazil income tax treaty?

No. There is no income tax treaty in force between the United States and Brazil. This is the counterintuitive fact that catches most people, and it is worth stating plainly because so much expat advice written for other countries assumes the opposite.

You can verify this yourself. Brazil does not appear on the IRS “United States Income Tax Treaties — A to Z” list, and it is absent from the agency’s treaty tables. The practical consequence is significant: you cannot point to a treaty article to assign taxing rights, claim a reduced withholding rate, or invoke a tie-breaker rule for residency. Every protection you rely on instead comes from US domestic law, applied unilaterally.

That sounds worse than it usually is. The US tax code carries its own tools for citizens abroad, and for most people in Brazil those tools do most of what a treaty would have done. The catch is that they must be chosen and combined deliberately, because nothing coordinates the two systems for you.

Legal basis: The absence of a treaty is itself the starting point. Verify by checking the IRS “Tax Treaties A to Z” table — Brazil does not appear. The US–Brazil Tax Information Exchange Agreement (TIEA, 2007) allows information sharing between governments but provides no relief from double taxation.

Which US–Brazil agreements do exist?

No income tax treaty does not mean no agreements at all. Three arrangements matter for an American in Brazil, and it helps to keep them separate from the absent income treaty.

The Totalization Agreement (Social Security)

The US and Brazil have a Social Security Totalization Agreement, signed in Washington on June 30, 2015, and in force since October 1, 2018. Its job is narrow but valuable: it prevents the same earnings from being charged social-security contributions in both countries at once, and it coordinates coverage periods. This is entirely separate from income tax, and it is the one true bilateral double-tax shield the two countries share. If you are paying into Brazil’s INSS on local employment, the agreement generally exempts you from US Social Security tax on those same earnings, and vice versa.

The FATCA intergovernmental agreement

Brazil and the US have a FATCA intergovernmental agreement under which Brazilian financial institutions report US-person account holders to the IRS. This is not relief — it is the infrastructure that makes your foreign accounts visible to the IRS. It is exactly why the FBAR and Form 8938 obligations discussed later in this guide are not theoretical: the accounts are already being reported.

The 2007 Tax Information Exchange Agreement

The two governments signed a TIEA in 2007, allowing the exchange of tax information on request. Like the FATCA agreement, this concerns transparency rather than relief. None of these three arrangements closes the gap left by the absent income tax treaty; they shape the compliance environment around it.

Arrangement	What it does	Status
Income tax treaty	Would assign taxing rights and reduce double income tax	Does not exist
Totalization Agreement	Prevents double Social Security tax; coordinates coverage	In force since Oct 1, 2018
FATCA IGA	Brazilian banks report US account holders to the IRS	In force
TIEA (2007)	Exchange of tax information between governments	In force

When do you become a Brazilian tax resident?

This matters because Brazilian tax residency is what creates the two-country problem. Once you are a Brazilian tax resident, Brazil taxes your worldwide income — not just Brazilian-source income — and you are still a US tax person by citizenship or green card. Two worldwide-income systems then point at the same money.

In broad terms, you generally become a Brazilian tax resident on arrival if you enter with a permanent visa or an employment relationship, and otherwise after 183 days of presence within a twelve-month period on other visas. The exact trigger and start date depend on your visa category and individual facts. Pinning down the precise start date is important because it drives everything downstream — the Brazilian filing clock, the FEIE qualifying period, and the carnê-leão obligation.

For a detailed breakdown of how and when residency attaches, how the day count works, and what happens when you leave, see our companion guide on income tax for foreigners in Brazil and the broader overview in finances and taxes for immigrants in Brazil.

How do you avoid double taxation without a treaty?

Without a treaty, double-tax relief comes from two US mechanisms, used alone or together. Choosing between them is the single most consequential decision on a US return filed from Brazil.

The Foreign Earned Income Exclusion (FEIE)

The FEIE lets a qualifying citizen abroad exclude foreign earned income — wages and self-employment income — from US tax, up to $130,000 for tax year 2025 and $132,900 for tax year 2026, per qualifying person. It is claimed on Form 2555. The limit is per person, so each spouse may claim it separately on their own qualifying earnings if each meets the bona fide residence or physical-presence test. The FEIE does not cover investment income, passive income, or US-source income, and it does not eliminate the duty to file a US return.

The Foreign Tax Credit (FTC)

The FTC, claimed on Form 1116, credits income taxes you actually paid to Brazil against your US tax on the same income. Brazil’s top individual rate is 27.5% on the higher IRPF brackets, and because Brazilian bands reach that rate at relatively modest amounts in comparison to US brackets, middle earners in Brazil often pay a higher effective Brazilian rate than they would in the US on the same income. Where that is true, the FTC can wipe out the US tax liability entirely and leave excess credits to carry forward.

How to choose

Neither tool is universally better. As a practical framework:

• Lean toward the FTC when your Brazilian tax on the income is high relative to the US tax — common for salaried professionals — because the credit can fully offset US tax and bank the surplus.
• Lean toward the FEIE when your Brazilian tax on earned income is low or zero, or your income sits well below the exclusion ceiling.
• Consider a combination — excluding earned income with the FEIE and crediting Brazilian tax on other income with the FTC — but coordinate carefully. The rules limit how the two interact, and a revoked FEIE election can be locked out for years.

For a deeper comparison, see our guide FEIE vs. Foreign Tax Credit for US expats in Brazil.

“Because there is no income tax treaty with Brazil, you cannot lean on treaty articles to sort out who taxes what. The whole plan has to be built around the Foreign Tax Credit and the FEIE — choosing between them deliberately, year by year, rather than defaulting to whatever a generic expat template suggests.” — Zachariah Zagol, OAB/SP 351.356

What is carnê-leão and who must file it monthly?

On the Brazilian side, the obligation that surprises Americans most is not annual — it is monthly. Carnê-leão is a mandatory monthly calculation and payment of Brazilian income tax on certain income that is not withheld at source. It typically applies to income received from individuals rather than registered companies, and to income received from abroad — exactly the category many US citizens in Brazil fall into, whether through foreign salary, consulting paid overseas, or rental income from a US property.

If that describes your situation, you generally compute and pay the tax each month using the Receita Federal’s system and then reconcile the monthly payments on the annual IRPF return. The carnê-leão obligation is not a separate tax on top of the annual return; it is a prepayment against it.

The trap is treating Brazil as a once-a-year filing country. Many newcomers discover the monthly obligation only after interest and penalties have already accumulated. The duty runs from the month the qualifying income first arrives, so identifying it early matters.

Legal basis: Carnê-leão feeds the annual Imposto de Renda da Pessoa Física (IRPF). The top marginal IRPF rate is 27.5%. Note: from 2026 onwards, Brazilian law provides a full exemption for those earning up to approximately R$60,000 per year (roughly R$5,000/month), with graduated reductions up to approximately R$88,200 annually — a meaningful change for lower earners but one that does not affect the top rate or the worldwide-income principle.

What changed for 2026?

Two Brazilian laws reshape the picture for Americans with foreign companies or assets, and both should be read against the official texts.

Law No. 14,754/2023 — offshore companies and trusts

This law changed how Brazilian residents are taxed on offshore financial investments, controlled foreign entities, and trusts. For a US citizen who is also a Brazilian resident, it can create a dual controlled-foreign-company (CFC) trap: the same foreign company may be caught currently by US CFC rules (Subpart F, GILTI) and by Brazil’s offshore-entity rules simultaneously, taxing overlapping income in two systems whose timing and credit mechanics do not naturally coordinate.

“The part that catches people under Law 14,754/2023 is the dual-CFC overlap. A single holding company can trip both the US and the Brazilian controlled-foreign-company rules in the same year, and because the two regimes do not coordinate, you can end up taxed twice on income the company has not even distributed yet. That overlap has to be mapped before it happens, not after.” — Zachariah Zagol, OAB/SP 351.356

Law No. 15,270/2025 — dividend withholding

This law introduced changes to Brazilian income tax rules including withholding on dividends — a notable shift in a country that had largely exempted dividends at the shareholder level. The effective dates, rates, and thresholds should be confirmed against the official Planalto text, as implementation details continue to be refined. Anyone receiving dividends from a Brazilian company needs to review this law before assuming the old treatment still applies.

What about FBAR and FATCA?

Relief mechanisms handle the income tax. Information reporting is a separate duty with its own penalties — penalties that apply even when you owe no additional tax.

FBAR — FinCEN Form 114

The FBAR is required if the combined value of all your foreign financial accounts exceeded $10,000 at any point during the calendar year — not the year-end average, but the peak aggregate value at any moment. It is filed electronically with FinCEN, separately from your tax return. For someone living in Brazil with a local bank account, this threshold is easy to reach, so treat the obligation as likely rather than remote.

FATCA — Form 8938

Form 8938 reports specified foreign financial assets when you meet the threshold for your filing status. For a single filer living abroad: more than $200,000 on the last day of the year, or more than $300,000 at any time. For married filing jointly abroad: more than $400,000 at year-end, or more than $600,000 at any time. Always confirm the exact threshold for your filing status and year from the IRS directly, since the figures differ by status.

FBAR and Form 8938 overlap but are not the same — different thresholds, different filing channels, different agencies. Many US citizens in Brazil must file both.

The Brazilian DCBE

The Declaração de Capitais Brasileiros no Exterior (DCBE) is a Central Bank of Brazil declaration filed by Brazil-resident taxpayers whose foreign assets exceed the reporting threshold. It is a Brazilian obligation pointing outward — the mirror image of the US reports pointing into Brazil. Our dedicated guide on declaring foreign assets in Brazil covers the DCBE thresholds and timing in full.

The combined US and Brazil filing calendar

Two systems mean two calendars, and they do not align. Keeping them on one page is the simplest way to avoid scheduling slips.

Obligation	Country	Typical timing
Carnê-leão self-assessment	Brazil	Monthly, as qualifying income arrives
Annual IRPF return	Brazil	Around late May (~May 29 for the 2026 cycle)
US federal return + FBAR + Form 8938	US	Automatic extension to June 15
Further US extension (on request)	US	To October 15

On the US side, interest can still run from the regular April 15 due date on any tax owed, so the extension moves the filing deadline more cleanly than it moves the payment deadline. On the Brazilian side, carnê-leão is a monthly obligation throughout the year, not something that waits for the annual return season.

Common mistakes

The same avoidable errors recur, and nearly all come down to assuming Brazil works like a treaty country or like a once-a-year filing.

• Assuming a treaty exists. Building a plan around treaty relief that is not there leaves income exposed and key decisions unmade.
• Defaulting to the FEIE without analysis. Excluding income by habit can waste a larger Foreign Tax Credit — and a revoked FEIE election can be locked out for years.
• Ignoring carnê-leão. Treating Brazilian tax as annual when the monthly self-assessment applies invites interest and penalties from month one.
• Overlooking the dual-CFC trap. A foreign holding company can be taxed currently in both systems under Law 14,754/2023 alongside US CFC rules.
• Skipping information reports. FBAR and Form 8938 penalties apply even when no income tax is due; the FATCA IGA means the accounts are already visible to the IRS.
• Forgetting the DCBE. The Central Bank declaration is easy to miss because it is filed separately from the tax return and has its own rules.
• Treating the exit as simple. When you leave Brazil and become a non-resident, a separate set of Brazilian tax obligations attaches — our guide on tax exit procedures for Brazil covers this in full.

An illustrative scenario

Hypothetical illustration — not a real client.

Consider a fictional, composite example built only to show how the pieces connect. Imagine a US citizen who moves to São Paulo for a senior corporate role, becomes a Brazilian tax resident on arrival because of the employment tie, and also holds a US brokerage account and a small foreign holding company from an earlier venture.

The high Brazilian tax on the salary points toward the Foreign Tax Credit rather than the FEIE, since the credit may offset the US tax liability fully and carry forward the excess. Consulting income paid from a US client would likely fall under monthly carnê-leão, so it is calculated and paid each month rather than waiting for the annual return. The holding company raises the dual-CFC question under Law 14,754/2023 alongside US Subpart F rules — that overlap is mapped before year-end, not after. The Brazilian bank account easily crosses the $10,000 FBAR threshold; Form 8938 depends on whether the FATCA threshold for the filing status is met; and the foreign holding company may independently trigger the Brazilian DCBE.

This example is purely illustrative, with every identifying detail invented. Real situations turn on their own facts and require individual analysis. Nothing here is a prediction of any outcome.

Deadlines and key terms at a glance

Item	Figure / timing	Source to confirm
FEIE (tax year 2025)	$130,000 per qualifying person	IRS — Form 2555 instructions
FEIE (tax year 2026)	$132,900 per qualifying person	IRS — Revenue Procedure for 2026
FBAR threshold	Over $10,000 aggregate at any time	IRS / FinCEN
Form 8938 (single, abroad)	$200,000 year-end / $300,000 any time	IRS — confirm by filing status
Brazil IRPF top rate	27.5% marginal	Receita Federal
US return (citizens abroad)	Automatic to June 15; Oct 15 on request	IRS
Brazil IRPF deadline	~Late May (2026: ~May 29)	Receita Federal

Key terms

• Foreign Earned Income Exclusion (FEIE) — excludes foreign earned income from US tax, up to $130,000 (2025) / $132,900 (2026) per person, on Form 2555.
• Foreign Tax Credit (FTC) — credits Brazilian income tax against US tax on the same income, claimed on Form 1116.
• Totalization Agreement — US–Brazil Social Security agreement, in force since October 1, 2018, preventing double social-security contributions on the same earnings.
• Carnê-leão — mandatory monthly Brazilian self-assessment on certain income not withheld at source, such as foreign-source payments or payments from individuals.
• IRPF — Imposto de Renda da Pessoa Física, Brazil’s individual income tax, with a top marginal rate of 27.5% on worldwide income for residents.
• FBAR — FinCEN Form 114, required when foreign financial accounts together exceed $10,000 at any point in the year.
• Form 8938 (FATCA) — US statement of specified foreign financial assets, with higher thresholds for taxpayers living abroad.
• DCBE — Declaração de Capitais Brasileiros no Exterior, Central Bank of Brazil declaration on foreign assets held by Brazilian residents above the threshold.
• Dual CFC trap — the exposure created when a foreign company is taxed currently under both US controlled-foreign-company rules and Brazil’s offshore-entity rules under Law No. 14,754/2023.

Key takeaways

• There is no income tax treaty between the US and Brazil — relief comes from US domestic rules, not treaty articles.
• The FEIE excludes up to $130,000 (2025) / $132,900 (2026) of earned income per qualifying person; the Foreign Tax Credit offsets US tax with Brazilian tax paid on the same income.
• Choose FEIE vs. FTC deliberately: the FTC often wins where Brazilian tax is high; the FEIE suits lower or untaxed earned income; combinations require careful coordination.
• A Totalization Agreement (in force October 1, 2018) prevents double Social Security tax — the one true bilateral shield the two countries share.
• Carnê-leão is a monthly Brazilian self-assessment on certain income — treating Brazilian tax as annual is a costly and common mistake.
• 2026 changes — Law 14,754/2023 (offshore entities, the dual-CFC trap) and Law 15,270/2025 (dividend withholding) — should be verified against the official texts for any entity or investment structure.
• FBAR (over $10,000 aggregate) and Form 8938 (FATCA) still apply, plus the Brazilian DCBE — confirm each threshold for your filing status and year.

Related guides on this site

• Income tax for foreigners in Brazil — complete guide — the Brazilian side of the picture, IRPF brackets, carnê-leão, and residency triggers
• International tax treaties in Brazil — overview — which countries have treaties with Brazil, and what the absence means for Americans
• Tax treaty between Brazil and the USA — what exists? — direct analysis of the no-treaty reality
• Finances and taxes for immigrants in Brazil — the broader financial picture for those settling in Brazil
• Declaring foreign assets in Brazil (DCBE) — the Central Bank reporting obligation
• US person with Brazilian rental income — tax guide — income-type deep dive for property holders
• Tax planning for foreigners in Brazil — structuring income and entities efficiently
• Tax exit from your home country when moving to Brazil — what happens to your US filing status when you establish Brazilian residency

How ZS Advogados can help

Two worldwide-income systems with no treaty between them, a monthly Brazilian filing obligation, US information reports with separate penalties, and recent Brazilian legislation that can tax a single company twice — none of these is complex alone, but they interact, and the interactions are where money and compliance go wrong.

Our cross-border team advises US citizens and green-card holders in Brazil on the Brazilian side of this picture, working alongside a US tax preparer who handles the US return, always centered on each person’s specific facts.

• International law — cross-border tax coordination, offshore entity analysis, bilateral compliance
• Tax law — Brazilian IRPF, carnê-leão obligations, DCBE declarations, tax residency
• Business law — foreign company structuring, dual-CFC exposure under Law 14,754/2023

Book a consultation to review your specific filing position before the next deadline.

Technical review by the ZS Advogados Associados cross-border team, including founding partner Zachariah Zagol (OAB/SP 351.356).

Sources and legal basis

• IRS — United States Income Tax Treaties A to Z (Brazil is not listed)
• IRS — Foreign Earned Income Exclusion (Form 2555)
• IRS — Report of Foreign Bank and Financial Accounts (FBAR), FinCEN Form 114
• IRS — Do I need to file Form 8938? (FATCA thresholds)
• US Social Security Administration — US–Brazil Totalization Agreement
• Receita Federal — Brazilian individual income tax (IRPF, carnê-leão, residency)
• Planalto — Law No. 14,754/2023 (offshore entities and trusts for Brazilian residents)
• Planalto — Law No. 15,270/2025 (income tax changes including dividend withholding)
• US Department of State — US–Brazil Agreement on Social Security (18-1001)

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This guide is for informational and educational purposes only, in line with Provimento No. 205/2021 of the Brazilian Bar Association (OAB). It is not legal or tax advice, an opinion, or an offer of services, does not refer to any specific case, and does not guarantee any result. Tax rules, rates, thresholds, and deadlines change and vary by individual situation; always confirm against official sources before acting. Each cross-border tax situation requires individual analysis by a licensed professional. Last updated June 2026.