Assurance-Vie for Americans in France: What the Contract Is, How France Taxes It and Passes It On, What the IRS Says You Must Report, and What Stays Unsettled (2026)

An assurance-vie is a French savings contract that economie.gouv.fr presents as a way to fund a medium or long-term project, prepare retirement and prepare succession, with its own rules for tax and for passing money on. For an American, it adds two U.S. questions the official French pages do not touch: what you must report to the IRS, which the IRS answers clearly, and how the contract’s gains and funds are taxed in the U.S., which the pages I read do not answer. This guide gives the French rules from the official pages, the IRS reporting rules, and a list of what to ask a professional.

The Short Answer

Source: service-public.gouv.fr (F15274, F15268, F22414); economie.gouv.fr; irs.gov.

This describes what the official pages say and is not tax advice. For where assurance-vie sits among the other places an American can keep money in France, see the guide to investing as an American in France and wealth management for Americans moving to France.

What the Contract Is

Economie.gouv.fr defines assurance-vie as a contract by which the insurer undertakes, in return for premiums, to pay an annuity or build a capital for the insured or their beneficiaries, and calls it a medium or long-term savings product. The contract is managed by an insurer and can be taken out through an insurance agent, a broker, your bank or a savers’ association. Service-public adds that there are three kinds: a contract that pays if you are alive at term, a contract that pays on death, and a mixed contract, which it calls the most common.

Who can take one out. In principle, any adult. Service-public says the legal capacity to subscribe is regulated, because naming a beneficiary is an act of disposition with consequences for property, and it lists the cases that need assistance, among them a person under curatorship or guardianship, and a person under an activated mandat de protection future.

What you pay in. Service-public says there is no maximum limit on payments, but premiums should not be excessive in relation to your financial and family situation at the time. You can pay a fixed periodic premium, free payments, or a single premium. Free payments are the most widespread.

Where the Money Goes: Euro Funds and Units of Account

Source: service-public.gouv.fr (F15274); economie.gouv.fr.

A contract with a single support is single-support, and one that combines several is multi-support. Economie.gouv.fr says that if you invest in units of account you may lose part or all of the capital, and that you should set your investor profile with your banker or insurer first.

Fees. Service-public lists four: an application fee at subscription, entry fees on each payment, management fees throughout the contract, and arbitration fees when you move money between units of account. They are deducted from the value invested, and the page says the profitability of the policy also depends on them.

Taking Money Out

The right to redeem belongs to the subscriber. A redemption can be total or partial; each one includes a share of capital, which is not taxable, and a share of gains. The insurer must pay within 2 months of the request. Service-public says early-redemption indemnities in the contract may not exceed 5% of the mathematical provision and are prohibited when redemption occurs more than 10 years after the start of the contract.

Two points to know before you sign:

• A 30-day right to change your mind. Service-public says you have 30 calendar days after being informed that the contract is concluded to cancel by registered letter.
• A beneficiary can lock the contract. If the person you named accepts the designation, the clause becomes irrevocable. Acceptance is only possible after 30 calendar days from when the insurer told you the contract was concluded. For an acceptance since 19 December 2007 in the forms provided by law, you can no longer redeem without the accepting beneficiary’s agreement.

How France Taxes Withdrawals

Service-public says that with an assurance-vie you are taxed only if you make a redemption, total or partial. Earnings are always subject to social levies of 17.2%, and income tax depends on the date of the premium and the age of the contract. For premiums paid since 27 September 2017:

Source: service-public.gouv.fr (F22414, 1 January 2026); economie.gouv.fr (7 October 2026).

The allowance applies to all the life insurance contracts held by the same taxpayer, and the €150,000 threshold is assessed across all your contracts. Premiums paid before 27 September 2017 follow an earlier regime, which both pages describe. Service-public says exemptions exist in certain cases, and economie.gouv.fr lists situations such as dismissal or early retirement.

Service-public says this for the French income tax return. If you are not a French tax resident, or if you also owe U.S. tax, these pages do not say how that changes the result. The guide to the French income tax return covers filing in France.

Passing It On: the Beneficiary Clause and Inheritance Tax

Economie.gouv.fr says that at the death of the subscriber, the sums paid to the beneficiaries are not part of the deceased’s estate, with capital passed on without tax up to €152,500 per beneficiary. Beyond that, the sums are not subject to inheritance duties but to a specific levy, owed by the beneficiary whatever their relation to the insured. How much depends on three factors: the date the contract was opened, the date the premiums were paid, and your age when you paid them.

Source: economie.gouv.fr (7 October 2026).

The beneficiary clause matters more than it seems. Service-public says that if no beneficiary is designated at death, the capital falls back into the estate and the tax benefit of passing through life insurance is lost. You can name a beneficiary in the contract with a standard or a nominative clause, or by referring to a will. Economie.gouv.fr says to write the clause precisely and to name subsequent beneficiaries who are called if the first ones die before you or refuse. You can change the clause until the beneficiary accepts. For complex situations, service-public advises seeing a notary.

For how a French estate works for an American, see French inheritance law for Americans and making a will in France.

What the IRS Says You Must Report

The IRS’s own pages are clear on reporting. They do not say how the policy is taxed.

• Form 8938. The Form 8938 instructions define a financial account as including any cash value life insurance or annuity contract maintained by an insurance company or other foreign financial institution. The IRS comparison table lists a foreign-issued life insurance or annuity contract with a cash value as reportable on Form 8938, above the threshold that applies to you.
• The FBAR. The same table lists it as reportable on the FBAR. The Internal Revenue Manual says an insurance or annuity policy with a cash value is an “other financial account”, that no current income payment is needed to trigger reporting, and that the cash value of the policy is considered the account value. The FBAR threshold is $10,000 in total across your foreign financial accounts at any time in the year.

The thresholds, the presence-abroad test and the deadlines are in the guide to FBAR vs Form 8938. Whether your own contract has a cash value, and how to value it for each form, is a question for a preparer.

Estate. The IRS estate tax page says the includible property can consist of cash, securities, real estate, insurance, trusts, annuities and other assets, and that for decedents dying in 2026 the filing threshold is $15,000,000. The page does not address a French contract or its beneficiary rules. The guide to U.S. estate tax for a non-citizen spouse covers the treaty side.

What the Pages I Read Do Not Settle

• How the U.S. taxes the gains or withdrawals of a policyholder. I found no IRS page on it.
• Whether the funds inside a unit-of-account contract are treated as PFICs (passive foreign investment companies). The IRS Form 8621 instructions I read concern stock of foreign corporations, including insurance corporations, and do not address a policyholder’s contract. The PFIC issue and the French funds it affects are explained in the investing guide.
• Whether a given insurer will take a U.S. citizen as a policyholder. That is a commercial decision no official page I read settles. Ask in writing.
• How French reporting rules, such as FATCA, apply to your contract. I did not read the French tax administration’s doctrine on it.

Questions to Ask Before You Sign

1. Will the insurer accept you as a U.S. citizen, and will it keep your contract open if you later move back to the U.S.?
2. Is the contract a euro-fund contract, a unit-of-account contract or a mix, and what exactly are the funds? Ask for the fund list so a preparer can check it.
3. Does the contract have a cash value, and what is the yearly statement of it, for the FBAR and Form 8938?
4. What are the four fees, in euros and percentages?
5. Who is the beneficiary, are there subsequent beneficiaries, and should you ask a notary to review the clause?
6. Has a cross-border tax preparer said in writing how the U.S. will tax your gains and withdrawals?

Frequently Asked Questions

What is an assurance-vie?

Economie.gouv.fr describes it as a contract by which the insurer undertakes, against premiums, to pay an annuity or build a capital for the insured or their beneficiaries, a medium or long-term savings product.

When does France tax an assurance-vie?

Service-public says you are taxed only when you redeem, in whole or in part. Social levies of 17.2% always apply to the earnings, and income tax depends on the date of the premiums and the age of the contract.

Do I have to report a French assurance-vie to the IRS?

The IRS tables list a foreign-issued life insurance or annuity contract with a cash value on both Form 8938 and the FBAR. Form 8938 applies above its threshold, and the FBAR applies when your foreign accounts total more than $10,000 at any time in the year.

Is an assurance-vie part of my estate?

Economie.gouv.fr says the sums paid to the beneficiaries are not part of the estate and pass tax-free up to €152,500 per beneficiary, with a spouse or PACS partner exempt. The IRS estate tax page lists insurance among property that can be in the gross estate, and does not address French contracts.

How are the gains taxed in the U.S.?

The IRS pages I read do not say. Ask a cross-border preparer before you subscribe or withdraw.

Can I change the beneficiary later?

Service-public and economie.gouv.fr say you can change the clause until the beneficiary accepts it. After a valid acceptance, the clause becomes irrevocable and you cannot redeem without the beneficiary’s written agreement.

Can I cancel after I sign?

Service-public says you have 30 calendar days after being informed that the contract is concluded, by registered letter.

Conclusion

An assurance-vie is a French savings contract taxed only on withdrawals, with a lower rate after 8 years, and passed to named beneficiaries outside the estate with a tax-free allowance of €152,500 each. For an American, the IRS requires the contract to be reported on both Form 8938 and the FBAR when it has a cash value and you are over the thresholds. What the official pages do not settle, how the gains and funds are taxed in the U.S., is the question that decides whether the contract suits you. Get that answer from a cross-border preparer, in writing, before you sign.