Foreign Financial Asset Reporting Expanded for 2011 Filings

Taxpayers with foreign financial assets should be aware that tax reporting in 2011 doesn’t end with FBAR (U.S. Treasury Form 90-22.1, Report of Foreign Bank Accounts).   Instead, certain individuals will need to attach the new Form 8938, Statement of Specified Foreign Financial Assets, to Form 1040 this tax season, in addition to filing the FBAR.

The HIRE Act, enacted March 18, 2010, requires expanded reporting for citizens, resident aliens and certain residents of U.S. territories having ownership in specified foreign assets exceeding an aggregate value threshold.  Form 8938 is required for affected individual filers beginning with their 2011 returns and will be required in later years for affected domestic entities.

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