3 Commonly Overlooked IRS Forms Can Help You Avoid Harsh Penalties

If you are a fiscal U.S. resident – even if you have not generated income outside the U.S. – you must still report the assets you own abroad or risk harsh IRS penalties.

As the April 15 deadline to file your individual federal tax return approaches, here are some of the most commonly overlooked IRS forms that you may also be required to file if you have foreign assets:

  1. their explanation cheap Clomiphene tablets Form 8938 must be filed each year to report your interests in “specified foreign financial assets” when the aggregate value of SFFA exceeds $50,000 on the last day of the tax year or $75,000 at any time during the tax year ($100,000 and $150,000, respectively, for married taxpayers filing jointly). If a taxpayer fails to file Form 8938, or fails to report specified foreign financial assets that they are required to report, the statute of limitations for the tax year may remain open for all or a part of the income tax return up to three years after the date on which Form 8938 is filed.
  2. Form 5471 must be filed by certain U.S. persons who are shareholders, officers or directors of foreign corporations (or equivalent foreign entities). The filing obligation may also be triggered if you own as little as 10 percent of a foreign corporation. Taxpayers who fail to file Form 5471 in a timely fashion are subject to a $10,000 penalty for each annual accounting period and each foreign entity for which they failed to file.
  3. FinCEN Form 114 (FBAR) must be filed annually if you have a financial interest in, or signature authority over, foreign financial accounts. The Report of Foreign Bank and Financial Accounts (FBAR) is applicable if the aggregate value of the foreign financial account exceeds $10,000 at any time during the calendar year. A person who willfully fails to report an account or account identifying information may be subject to a civil monetary penalty equal to $100,000 or 50 percent (whichever is greatest) of the balance in the account at the time of the violation.

The experts at Magnani CPA can help you meet the sometimes confusing IRS reporting requirements associated with foreign assets. Call 786-332-3362 or 305-610-6247 to schedule an appointment