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Tag Archive for Form 8938

Tax Treaty Tiebreaker And Reporting: Forms 8938, 8621, 5471

John Richardson

Previously, we have look at the tax treaty tiebreaker and how it relates to taxation of Subpart F and PFIC income as well as eligibility for streamlined offshore procedures. This is another in a series of posts on the tax treaty tiebreaker (which is a standard provision in most U.S. tax treaties).

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U.S. Taxpayers Face Horrendous Fines When They Fail To Report Foreign Financial Assets

US taxpayers face horrendous fines for failing to accurately report foreign financial assets on the annual 1040 tax return using form 8938. The fines range from 50%-125% of the asset value every year not accurately reported. This is very serious stuff.

One individual pointed out that the IRS has a document called “Question & Answers on Form 8938” which says that ownership of “foreign real estate is not is not a specified foreign financial asset required to be reported on form 8938.” While this is narrowly true, it is dangerously misleading. Here’s why.

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Foreign Asset Reporting For Entities: New For 2016!

Manasa Nadig

There is a lot of attention these days on big companies (Apple, Google, General Electric, Facebook and others) stashing their earnings overseas in what are considered tax havens to avoid paying U.S. taxes on their corporate income. Some international tax reform proposals have been suggested as to how to get the corporation to either bring this stash back into the U.S. by way of a “repatriation holiday” or “deemed repatriation” or ending the system of tax deferrals. Read more

Is Form 8938 Required By “Green Card Holders” Who Are Nonresidents By “Treaty Tie Breaker”?

John Ricahrdson

The context: Form 8938 was created by the IRS to meet the reporting requirements mandated by Internal Revenue Code S. 6038D. S. 6038D was mandated by S. 511 of the HIRE Act.

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New Pressure To Put On FATCA Countries To Comply

Ephraim Moss

Over the past several, years, the U.S. government has signed intergovernmental agreements (IGAs) with dozens of partner countries (83 altogether at latest count), which are designed to promote the implementation of the FATCA law requiring financial institutions (mainly banks and investment houses) outside the U.S. to report information on financial accounts held by their U.S. customers to the IRS.

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June 30th Filing Deadline for Foreign Reporting is Approaching Fast!!

Taxpayers With Foreign Assets May Have FBAR And FATCA Filing Requirements In June

WASHINGTON—The Internal Revenue Service today reminded all taxpayers with an FBAR filing requirement to report their foreign assets by the June 30 deadline. FBAR filings have risen dramatically in recent years as FATCA phases in and other international compliance efforts have raised awareness among taxpayers with offshore assets.

The IRS encourages taxpayers with foreign assets, even relatively small amounts, to check if they have a filing requirement. Separately, certain taxpayers living abroad may also have to file the FATCA-related Form 8938 with their tax returns by the June 15 Read more

IRS Reminds Those With Foreign Assets of U.S. Tax Obligations

WASHINGTON — The Internal Revenue Service reminded U.S. citizens and resident aliens, including those with dual citizenship who have lived or worked abroad during all or part of 2014, that they may have a U.S. tax liability and a filing requirement in 2015.

Most People Abroad Need to File

A filing requirement generally applies even if a taxpayer qualifies for tax benefits, such as the foreign earned income exclusion or the foreign tax credit , that substantially reduce or eliminate their U.S. tax liability. These tax benefits are not automatic and are only available if an eligible taxpayer files a U.S. income tax return.

The filing deadline is Monday, June 15, 2015, for U.S. citizens and resident aliens whose Read more

Taxpayer Advocate Request Easing Foreign Reporting Requirements For US Taxpayers Abroad!

The National Taxpayer Advocate suggested to the Internal Revenue Service to reduce the duplicate foreign asset reporting requirements created by the Foreign Account Tax Compliance Act. The Taxpayer Advocate Service (TAS) is your voice at the IRS. Our job is to ensure that every taxpayer is treated fairly, and that you know and understand your rights.

April 13, 2015 the National Taxpayer Advocate stated in Recommendations for Published Guidance under IRC §§ 60380 and 1471: Eliminate Duplicative Reporting of Assets on the FATCA Form 8938 if the Asset is Reported or Reflected on the FBAR (FinCEN Report 114) and Exclude Financial Accounts Maintained by a Financial Institution in the Country of  Which the U.S. Person is a Bona Fide Resident from FATCA Reporting: Read more

A Point To Ponder

Most of us remember the good old days of the 1990s – a seemingly decisive victory in the First Persian Gulf War, the dot-com bubble that transformed computer geeks into nouveau riche millionaires, and a string of world championships that made the New York Yankees appear seemingly unbeatable. President Bill Clinton did a good job of manning the wheel during most of the decade, although truth be told, almost anyone can sail a ship when the seas are calm and a gentle but steady breeze is filling the sails.

Mr. Clinton did have his shortcomings, most notably his interaction with a certain intern which led to. . . well, we’ll skip all the sordid details. He was certainly not the first President to behave in such a manner, and he will not be the last one, but he was the only one to be caught in such a dramatic fashion. After he appeared before a federal grand jury, Read more

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