Foreign Account Tax Compliance Act (FATCA)
This is a new law that requires foreign banks to share financial information to the US. FATCA rules requires reporting of foreign bank accounts and specified foreign financial assets. The range for reporting thresholds vary and we can help identify these thresholds for taxpayers living abroad. There is a significant failure to disclose penalty as well as an additional penalty of non-filing.
Reportable Assets
- Financial (deposit & custodial) accounts held at foreign financial institutions
- Shares in a mutual fund
- Foreign stock or securities account
- Indirect interest through an entity (>50% interest)
- Foreign life insurance or annuity contract with cash value
- Financial account in a foreign branch of a U.S financial institution
- Foreign accounts held by a foreign or domestic grantor trust
Non-reportable assets
- Financial account held at a U.S. branch of a foreign financial institution
- Foreign real estate held directly (includes personal residence and rental properties)
- Foreign real estate held through a foreign entity
- Domestic mutual fund investing in foreign stocks and securities
- Foreign currency held directly
- Precious metals held directly
- Personal property, held directly, such as art, antiques, jewelry, cars and other collectibles
- Social security, social insurance, or other similar program of a foreign government
| Type of Filing | Form |
|---|---|
| Expat Taxes | 1040, 2555, 1116 and/or State Income Taxes |
| FBAR | 114 |
| FATCA | 8938 |
| CFC | 5471 |
| PFIC | 8621 |