What Happens to My U.S. Brokerage Account If I Lose My U.S. Address?

May 21

Living abroad as a U.S. expat comes with a long list of financial complexities. One that often gets overlooked—until it’s too late—is what happens to your U.S.-based investment accounts if you no longer have a valid U.S. address.

This topic has been on my mind more and more lately, so let me share a bit about my personal situation and what I've learned.

My Personal Concern

Right now, I still have a U.S. address—through a relative’s home. I’ve kept that address active and legitimate in several ways:

I maintain a driver’s license registered to that address
I pay a utility bill for the property
All of my financial institutions send their mail there
I continue to file and pay state taxes tied to that location

This setup allows me to keep my U.S. brokerage account open, even while living full-time in Japan.

But what happens if that relative moves abroad or passes away?

That address goes away. And if I’m not prepared, I risk losing access to my U.S. investment accounts—or being forced to sell and pay capital gains tax unexpectedly.

What a U.S. Brokerage Might Do If You Lose Your Address

U.S. brokerages require you to have a valid U.S. address on file. If they determine that you're no longer a U.S. resident—or that you’ve updated your address to a foreign country—they may:

✅ Restrict new activity in your account. You’ll still own your assets and can sell, but you can’t buy anything new.
⚠️ Freeze account updates, prevent address changes, or require you to transfer your account to another institution.
❌ Force account closure in rare cases, particularly for IRAs or mutual fund-only accounts, potentially triggering capital gains taxes if your assets are sold.

Once you update your address to Japan, it’s very difficult to reverse course.

What I'm Doing to Prepare

I’ve thought a lot about this, and here’s the plan I’m using to make sure I’m not caught off guard.

1. Maintain a Valid U.S. Residential Address

As long as I own or have legal ties to a U.S. address, I can continue using it as my U.S. residence for brokerage and tax purposes.

I’ve backed that up by:

Keeping my driver’s license current at that address
Paying a utility bill
Having financial documents mailed there
Continuing to file state taxes

2. Use a Mail Forwarding Service (If Needed)

If I lose access to my current U.S. address, I’ll start using a reputable mail forwarding service. These services give you a real U.S. street address (not a P.O. Box) and let you receive, scan, and forward mail digitally.

I’ll still need a valid residential address on file with my brokerage, but the forwarding service helps me manage important mail while living abroad—without relying on tenants or distant family.

3. Establish a Backup Brokerage Account

I’ve already opened an account with Interactive Brokers Japan (IBJ), which is expat-friendly and allows a Japan address. I hold the same U.S.-listed ETFs there that I hold in my U.S. account.

If I ever run into trouble with my U.S. brokerage, I have a seamless backup.

Can I Transfer My Holdings Without Paying Capital Gains Tax?

Yes. If I ever need to move my investments from my U.S. brokerage to IBJ, I can do so through an in-kind transfer.

That means:

❌ No capital gains tax (because nothing is sold)
✅ My original cost basis and holding period stay intact
✅ I stay fully invested without disrupting my long-term plan

The process is fairly straightforward—you initiate the transfer from within IBJ, and your shares move as-is from one institution to the other.

Final Thoughts

Being an American investor living in Japan means planning around rules that weren’t built with us in mind. But with some foresight, you can keep your investment strategy on track—without unnecessary taxes or account restrictions.

If you're using a relative’s U.S. address and know it may not be available forever, now is the time to plan. Mail forwarding services, backup brokerage accounts, and maintaining a strong U.S. residency tie can save you a lot of stress down the road.

If you want help evaluating your options or understanding how to do this for yourself, reach out anytime.

Until next time — keep growing your wealth across borders.

– The FI Professor

Disclaimer

This post is for informational and educational purposes only and does not constitute investment, legal, or tax advice. Always consult with a qualified financial advisor or tax professional regarding your specific situation. The views expressed are my own and based on personal experience as a U.S. expat living in Japan.

Daniel Mills