How to Buy Korean Stocks From the US, Tax Included

You can buy Korean stocks from the US through a US brokerage account, and since May 2026, that includes the Korean-listed shares themselves, not only the handful of companies with American listings. The catch is mostly tax plumbing. Korea’s treaty rate on dividends for US residents is 16.5%, not the 15% that many guides quote, and an omnibus account withholds 22% first. The IRS lets you credit that 16.5%, but nothing above it. And the route you pick decides which US forms follow you: a US broker keeps the paperwork light, while a Korean account or a Korean-listed fund can add FBAR, Form 8938, or the passive foreign investment company rules. The hub guide, How to Invest in Korean Stocks From abroad compares the four routes in general. Here’s the version for a US taxpayer.

Key Takeaways

• One US broker has announced direct Korean access. Interactive Brokers launched Korea Exchange (KRX) trading on May 7, 2026, calling itself the first major US-based broker to offer it.
• The ADR list is short, and Samsung isn’t on it. Samsung Electronics lists its global depositary receipts in London, and US individual investors can’t trade them under Rule 144A.
• Your treaty rate is 16.5%, local tax included. KB Financial’s annual report to the SEC gives the US treaty rates as 16.5% or 11.0%, depending on the holding.
• Taxes above the treaty rate aren’t creditable. The IRS limits the credit to the tax you’d owe at the treaty rate, so 22% withheld through an omnibus account leaves 5.5 points to reclaim from Korea.
• The paperwork depends on the route. A Korean account counts toward FBAR and Form 8938. Shares held at a US broker don’t go on Form 8938. A Korean-listed fund can be a PFIC.

Contents

1. Four routes for a US taxpayer
2. Buying Korean-listed shares from a US account
3. ADRs and US-listed funds
4. What Korea withholds from your dividends
5. Claiming the credit on your US return
6. When you sell
7. The forms each route brings
8. Easy mistakes
9. Frequently asked questions

1. Four routes for a US taxpayer

Route	What you hold	Korean tax on dividends	US paperwork beyond your return
US broker with KRX access	Korean-listed shares, priced in won	22% withheld if it runs through an omnibus account, treaty rate by later claim	Form 1116, or the small-amount election; no Form 8938 for the account
Korean brokerage account in your name	Korean-listed shares, priced in won	16.5% with proof of US residence, otherwise 22%	FBAR above $10,000; Form 8938 above its threshold
US-listed ADR	A depositary receipt backed by Korean shares	Same withholding as the shares	Form 1116 or the small-amount election
US-listed Korea ETF	Units of a US fund	Inside the fund	The fund’s US tax reporting

Most US investors will start in the first or third row. The second suits someone who wants the treaty rate at source and doesn’t mind the extra filings. The fourth gives up stock selection for simplicity.

2. Buying Korean-listed shares from a US account

Interactive Brokers’ May 7, 2026 announcement is the one I can point to. The company called itself the first major US-based broker to offer KRX trading and said existing clients can start by enabling KRX market data and trading permissions in Client Portal.

I have not found a comparable public announcement from the other large US brokerages. Ask yours directly. If it offers Korean shares, ask a second question: does it trade them through Korea’s omnibus account?

That question matters because of how Interactive Brokers got in. According to a May 2026 Korea Herald report, its Korean access launched through an omnibus account with Samsung Securities, a structure in which the US broker holds one account in Korea in its own name for all its clients. Korea’s financial regulator named the partner as Interactive Brokers’ UK entity, and I haven’t confirmed whether US clients’ orders take the same path. Our omnibus account guide explains why the answer changes your dividend tax.

The alternative is a Korean brokerage account in your own name. Korea abolished its separate registration requirement for foreign investors on December 14, 2023, so a passport does the job.

3. ADRs and US-listed funds

If the company you want has a US listing, this is the easiest route. KB Financial trades on the NYSE as KB, one ADS per common share. SK Hynix listed ADSs on Nasdaq under SKHY in July 2026, each worth one-tenth of a common share. The list I could confirm in SEC filings, with ratios and depositaries, is in Korean stocks on US exchanges.

Samsung Electronics is the obvious gap. Its common shares trade on KRX and its global depositary receipts trade in London, and the company’s investor page says US individual investors can’t trade those receipts under Rule 144A. For Samsung, the KRX share is the route.

Two tax points carry over. Dividends on ADSs face the same Korean withholding as dividends on the shares. And a transfer of depositary receipts listed on the NYSE, Nasdaq, or another qualified foreign exchange is exempt from Korea’s securities transaction tax.

The fund route is one ticker deep for most people. The iShares MSCI South Korea ETF (EWY) trades on NYSE Arca, tracks the MSCI Korea 25/50 Index, and has run since May 9, 2000, with a stated expense ratio of 0.59% a year. It’s a US fund, so Korean tax is handled inside it.

4. What Korea withholds from your dividends

Korea’s default withholding on dividends paid to a non-resident is 22%, local income tax included. For US residents the treaty lowers that. KB Financial’s annual report to the SEC gives the reduced rates as 16.5% or 11.0%, depending on the shareholding, and inclusive of local income surtax. For a portfolio investor, the working number is 16.5%. The 15% you see in many guides leaves out the local surtax.

The lower rate isn’t automatic. Whoever pays the dividend needs evidence of your tax residence before or at the time of payment. Without it, the payer withholds at the normal rate.

On an omnibus account, the law sets the sequence. Under Article 156-9 of Korea’s Income Tax Act, whoever pays Korean-source income through an omnibus account withholds at the ordinary non-resident rate when paying the account holder. An investor who wants the treaty rate then files a claim for correction with the Korean tax office. Ask your broker, in writing, whether it files that claim for you.

5. Claiming the credit on your US return

You can claim a foreign tax credit for Korean tax on your dividends, usually on Form 1116. There’s a shortcut for small amounts. The Form 1116 instructions let you claim the credit without the form if all your foreign income is passive, such as most dividends; the income and tax were reported on a statement like Form 1099-DIV; and your total creditable foreign taxes aren’t more than $300, or $600 on a joint return. Take that election, and you can’t carry unused foreign tax to another year.

The bigger trap is the rate. The IRS says the creditable amount isn’t necessarily what was withheld, and a foreign country would refund under a treaty isn’t creditable. The Form 1116 instructions give the case directly: a country withholds $25, the treaty says you owe $15, and only $15 is eligible for the credit, whether or not you apply for the refund. If an omnibus account withholds 22% and your treaty rate is 16.5%, plan on 16.5% as the creditable amount. The other 5.5 points come back only through the Korean claim for correction. If nobody files it, that money is likely lost.

6. When you sell

Korea’s own law exempts a non-resident’s gains on shares sold through the KRX KOSPI Market, provided the seller has no permanent establishment in Korea and hasn’t owned 25% or more of the company, together with related parties, in the year of sale or the five years before. Your gain is reported in the US.

What you pay in Korea is the securities transaction tax. A sale on KOSPI carries 0.20% of the sale price, made up of 0.05% of securities transaction tax and 0.15% of the rural development surtax. It is levied on the sale, so it applies whether you made money or not. ADR transfers on a qualified foreign exchange are exempt.

7. The forms each route brings

A Korean brokerage account. It’s a foreign financial account. The FBAR applies if the total value of your foreign accounts exceeded $10,000 at any time in the year. It is filed electronically with FinCEN and due April 15 following the calendar year. Form 8938 applies on top of that above its own threshold. For an unmarried taxpayer living in the US, the IRS comparison table puts it at more than $50,000 on the last day of the year or more than $75,000 at any time; for a joint return, $100,000 and $150,000. On both forms you report the account, not each stock in it.

Korean shares at a US broker. The Form 8938 instructions say an account maintained by a US payer, such as a domestic financial institution, isn’t a specified foreign financial asset, and neither are the assets in it. So Korean shares held through a US broker don’t go on Form 8938.

A Korean-listed fund. This is where US investors get caught. A foreign corporation is a passive foreign investment company if 75% or more of its gross income is passive or at least half its assets produce passive income, according to the Form 8621 instructions. A fund listed in Seoul can fall into that category, which brings Form 8621 and harsher tax treatment. Whether a particular Korean fund does depends on its legal form, and that’s a question for a US tax adviser before you buy, not after.

8. Easy mistakes

Planning around 15%. Your Korean dividend rate is 16.5% once local surtax is counted.

Expecting the IRS to credit the full 22%. It will not credit tax above the treaty rate. On an omnibus account, the difference has to come back from Korea.

Buying a Korean ETF on KRX because it’s cheaper than EWY. The fee may be lower. The US tax treatment may not be.

Forgetting a small Korean account. The FBAR threshold counts all your foreign accounts together, and $10,000 is a low bar.

9. Frequently asked questions

Can I buy Samsung Electronics from the US?

Not as an ADR, because there isn’t one. You can buy the KRX-listed shares through a broker with Korean access or a Korean account in your name.

Do I need to register with a Korean regulator?

No. Korea abolished the separate registration requirement for foreign investors on December 14, 2023.

Do ADR dividends get the treaty rate?

They face the same Korean withholding as the underlying shares: 22% unless a treaty rate applies.

Can I buy Korean ETFs through an omnibus account?

Korea’s rules have included KRX-listed ETFs and ETNs in omnibus-account trading since September 15, 2026, excluding leveraged and inverse products. Actual trading depends on each broker, and Money Today reported on September 26, 2026 that the industry expects it to begin in earnest on January 1, 2027, when a proposed change to the omnibus withholding rule would apply if enacted. Ask your broker whether it offers them, and check the PFIC question before you do.

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Disclaimer: This article is for general informational purposes only and does not constitute investment, legal or tax advice. It describes Korean withholding rules, company filings with the US Securities and Exchange Commission and IRS guidance as published on the dates cited, as of October 17, 2026. Tax treatment depends on your own circumstances and can change. Confirm your position with your broker, the IRS or a qualified tax professional before you act.

Last updated: October 23, 2026