Do I need to file Form 8938?


Do I need to file Form 8938, “Statement of Specified Foreign Financial Assets”?

Certain U.S. taxpayers holding specified foreign financial assets with an aggregate value exceeding $50,000 will report information about those assets on new Form 8938, which must be attached to the taxpayer’s annual income tax return.  Higher asset thresholds apply to U.S. taxpayers who file a joint tax return or who reside abroad (SEE BELOW).
Form 8938 reporting applies for specified foreign financial assets in which the taxpayer has an interest in taxable years starting after March 18, 2010.  If you do not have to file an income tax return for the tax year, you do not need to file Form 8938, even if the value of your specified foreign assets is more than the appropriate reporting threshold.

•    If you are required to file Form 8938, you do not have to report financial accounts maintained by:
•    a U.S. payer (such as a U.S. domestic financial institution),
•    the foreign branch of a U.S. financial institution, or
•    the U.S. branch of a foreign financial institution.

Note:  The Form 8938 does not replace or otherwise affect a taxpayers obligation to file Form TD F 90-22.1 (Report of Foreign Bank and Financial Accounts, aka FBAR).  Individuals must file each form for which they meet the relevant reporting method.

You must file Form 8938 if:
1. You are a specified individual.
A specified individual is:

•    A U.S. citizen
•    A resident alien of the United States for any part of the tax year (see Pub. 519 for more information)
•    A nonresident alien who makes an election to be treated as resident alien for purposes of filing a joint income     tax return
•    A nonresident alien who is a bona fide resident of American Samoa or Puerto Rico (See Pub. 570 for definition of a bona fide resident)

AND
2. You have an interest in specified foreign financial assets required to be reported.
A specified foreign financial asset is:

•    Any financial account maintained by a foreign financial institution, except as indicated above
•    Other foreign financial assets held for investment that are not in an account maintained by a US or foreign financial institution, namely:
•    Stock or securities issued by someone other than a U.S. person
•    Any interest in a foreign entity, and
•    Any financial instrument or contract that has as an issuer or counterparty that is other than a U.S. person.
Refer to the Form 8938 instructions for more information on the definition of a specified foreign financial assets and when you have an interest in such an asset.

AND
3. The aggregate value of your specified foreign financial assets is more than the reporting thresholds that applies to you:

•    Unmarried taxpayers living in the US: The total value of your specified foreign financial assets is more than $50,000 on the last day of the tax year or more than $75,000 at any time during the tax year
•    Married taxpayers filing a joint income tax return and living in the US: The total value of your specified foreign financial assets is more than $100,000 on the last day of the tax year or more than $150,000 at any time during the tax year
•    Married taxpayers filing separate income tax returns and living in the US: The total value of your specified foreign financial assets is more than $50,000 on the last day of the tax year or more than $75,000 at any time during the tax year.
If you are a taxpayer living abroad you must file if:
•    You are filing a return other than a joint return and the total value of your specified foreign assets is more than $200,000 on the last day of the tax year or more than $300,000 at any time during the year; or
•    You are filing a joint return and the value of your specified foreign asset is more than $400,000 on the last day of the tax year or more than $600,000 at any time during the year.
•    You are a taxpayer living abroad if:
•    You are a U.S. citizen whose tax home is in a foreign country and you are either a bona fide resident of a foreign country or countries for an uninterrupted period that includes the entire tax year, or
•    You are a US citizen or resident, who during a period of 12 consecutive months ending in the tax year is physically present in a foreign country or countries at least 330 days.

Reporting of Foreign Bank Accounts (FBAR)