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The short answer
Owning Nigerian land or a house directly is not itself reported: the IRS says foreign real estate is not a specified foreign financial asset for Form 8938, and the FBAR covers financial accounts, not property. But a US citizen or resident must report rental income from it on Schedule E, a sale on Form 8949 and Schedule D, and any Nigerian bank account holding the rent or proceeds on the FBAR if foreign accounts exceed $10,000 at any time in the year.
What is not reported
Many Nigerians in the US assume every foreign asset must go on a form. For property held in your own name, it does not.
- Form 8938. In its Form 8938 questions and answers (reviewed August 2026), the IRS says: "Foreign real estate is not a specified foreign financial asset required to be reported on Form 8938."
- FBAR (FinCEN Form 114). The FBAR is for financial accounts at institutions outside the US, such as bank, brokerage and mutual fund accounts. A plot of land or a house is not an account.
There is no annual US form simply for owning a house in Lekki or land in Enugu. The obligations come from what the property does and how you hold it.
What is reported
| Situation | US reporting | Source |
|---|---|---|
| You let the property | Rent and expenses on Schedule E; depreciation on Form 4562 | IRS Publication 527 |
| You sell it | Gain or loss on Form 8949 and Schedule D, in dollars | IRS Topic 409 |
| Rent or proceeds sit in a Nigerian bank | FBAR if all foreign accounts exceed $10,000 at any time; Form 8938 if thresholds met | IRS FBAR page; Form 8938 comparison |
| You paid Nigerian tax on rent or gain | Foreign tax credit on Form 1116, or itemised deduction | IRS foreign tax credit page |
| Property held through a Nigerian company | The shares may bring Form 5471 and Form 8938 | See our Form 5471 guide |
| You die owning it | Worldwide gross estate counted for estate tax filing | IRS estate tax FAQ |
Rental income
IRS Publication 527 says Schedule E is the basic form for residential rental income and expenses, listing each property. Nigerian rent is converted to dollars at the rate prevailing when it was received. Because the property is used predominantly outside the US, it is depreciated over 30 years under the alternative depreciation system (26 U.S.C. s.168(g)); see depreciating Nigerian rental property. Rent a family member pays you counts too, and if you charge less than fair rent the expense rules change; ask a preparer.
Sale
A sale is reported whether or not the money leaves Nigeria. The gain is figured in dollars using rates on the purchase and sale dates, and long-term rates apply if you held it for more than a year (Topic 409). See selling Nigerian property: tax in both countries.
The accounts around the property
The FBAR threshold is aggregate: if your Nigerian accounts together exceed $10,000 at any time in the calendar year, you report all of them on FinCEN Form 114, filed electronically through BSA E-Filing (not with your return), due 15 April with an automatic extension to 15 October. A single year's rent paid upfront into a naira account can cross that line. Form 8938 has higher thresholds: for a single filer living in the US, more than $50,000 on the last day of the year or $75,000 at any time; for joint filers living in the US, $100,000 and $150,000 (IRS comparison page, reviewed September 2026).
Worked example (illustrative)
A teacher in Houston owns a Lagos flat let for ₦4,800,000 a year, paid upfront into her naira account in January. At an example rate of ₦1,500 to $1 that is $3,200. Her other Nigerian account holds ₦12,000,000 (about $8,000). Combined, $11,200 exceeds $10,000, so both accounts go on the FBAR. Her foreign financial assets are under $50,000, so Form 8938 is not triggered. The flat itself appears on neither form, but the $3,200 rent goes on Schedule E. Figures are examples.
Mistakes we see often
- Leaving Nigerian rent off the return because it never left Nigeria. US citizens and residents are taxed on worldwide income (IRS Publication 54), wherever the money is kept.
- Using today's exchange rate for a purchase made years ago. Cost is converted at the rate when you paid.
- Depreciating over 27.5 years. Foreign rentals use 30 years under the alternative depreciation system.
- Counting only the bank account where rent lands and forgetting a second naira account or a fund account when testing the FBAR threshold.
- Assuming the property is reportable on Form 8938 and missing the accounts that are.
Estate planning
The IRS estate tax FAQ says the gross estate includes everything owned at death, including real estate, and the 2026 filing threshold for a US citizen or resident is $15,000,000. Most families will be below it, but Nigerian property counts toward the total. See inheriting property in Nigeria while living in the US.
Where Pryme fits
Naira in a Pryme account is held by a licensed Nigerian microfinance bank, so treat it as a foreign account for FBAR purposes. What helps is clean records: statements and verifiable receipts through VerifyDoc.ai (receipts) show what rent arrived and when, and Swap gives a dated rate and fee on each conversion you approve. See multicurrency accounts, and for the Nigerian RSA question is a Nigerian RSA reportable on the FBAR?
Questions people ask
Do I report my house in Nigeria on the FBAR?
No. The FBAR covers financial accounts, not real estate. Nigerian bank accounts holding rent or proceeds may need to be reported.
Is foreign real estate reported on Form 8938?
No. The IRS says foreign real estate is not a specified foreign financial asset for Form 8938.
Do I pay US tax on rent from Nigeria?
Yes, if you are a US citizen or resident. Report it on Schedule E in dollars; Nigerian tax paid may be creditable.
Does the IRS know about my Nigerian property?
Whether or not it does, the obligation is yours: rent and sales are reportable, and the accounts that hold the money may be too.
Sources
- IRS: Basic questions and answers on Form 8938 (reviewed 17 Aug 2026) · accessed Oct 2026
- IRS: Report of Foreign Bank and Financial Accounts (FBAR) (reviewed 30 Jul 2026) · accessed Oct 2026
- IRS: Comparison of Form 8938 and FBAR requirements (reviewed 19 Sep 2026) · accessed Oct 2026
- IRS: Publication 527 (2025), Residential Rental Property · accessed Oct 2026
- IRS: Topic no. 409, Capital gains and losses (reviewed 24 Sep 2026) · accessed Oct 2026
- IRS: Frequently asked questions on estate taxes (reviewed 23 Jul 2026) · accessed Oct 2026
- IRS: Publication 54 (12/2025), Tax Guide for U.S. Citizens and Resident Aliens Abroad · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.