How do NRE and NRO accounts get reported differently?

For U.S. reporting, NRE and NRO accounts are treated the same way — both are foreign financial accounts and both count toward your FBAR and Form 8938 thresholds, reported at their maximum yearly balance. The 'NRE vs NRO' distinction is an Indian banking concept about repatriation and which income flows in, not a U.S. carve-out. Where they differ is the income and foreign-tax-credit picture: NRO interest is typically subject to Indian TDS, so you'll have foreign tax to credit on your U.S. return, while NRE interest may be tax-free in India but is still fully taxable to you as a U.S. person. Either way, the interest is U.S.-taxable worldwide income reported annually. Many immigrants assume NRE being tax-free in India means tax-free everywhere — it isn't, for a U.S. person. Report both account balances on the FBAR and both streams of interest on your 1040.