In the eyes of the IRS, there is no difference between Green Card Holders and US citizens for tax purposes. That is, Green Card Holders have the same tax reporting obligations as US citizens. A Green Card Holder is at risk of significant non-compliance depending upon the value of their unreported accounts and assets; and sometimes they are at greater risk given their strong family and financial ties to their homeland.
Green Card Holders are not exempt from filing IRS Form 8938 with their IRS Form 1040s nor FBAR requirements – if their accounts meet the threshold requirements described above. The misconception arises because Green Card Holders are also foreign nationals of another country, and he or she may believe they are somehow exempt. That is not the case. Green Card Holders must understand that if they avail themselves of the rights and privileges of the United States, they then subject themselves to the laws of the United States, including its tax laws. Like US citizens, failure to comply with foreign bank account reporting requirements carries severe penalties; however, also like US citizens, Green Card Holders may take advantage of the same voluntary compliance procedures available to US taxpayers (see below).