8938 Instructions for Form 8938

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Instructions for Form 8938

Department of the Treasury
Internal Revenue Service

(Rev. November 2021)

Statement of Specified Foreign Financial Assets
Section references are to the Internal Revenue
Code unless otherwise noted.

must be reported, see Who Must File,
Specified Domestic Entity, Specified
Foreign Financial Assets, Interests in
Specified Foreign Financial Assets, and
Assets Not Required To Be Reported,
later.

Do not send a Form 8938 to the
IRS unless it is attached to an
annual return or an amended

DRAFT AS OF
November 5, 2021

Future Developments

For the latest information about
developments related to Form 8938 and
its instructions, such as legislation
enacted after they were published, go to
IRS.gov/Form8938.
For more information about section
6038D information reporting, see
IRS.gov/Businesses/Corporations/
Basic-Questions-and-Answers-onForm-8938.

What’s New
Continuous-use form and instructions. Form 8938 and these
instructions have been converted from
an annual revision to continuous use.
Both the form and instructions will be
updated as needed. For the most recent
versions, go to IRS.gov/Form8938.

Reminders
Reporting obligations under section
6038D not affected. Rev. Proc.
2020-17, available at IRS.gov/pub/irsdrop/rp-20-17.pdf, exempts foreign trust
information reporting requirements on
Forms 3520 and 3520-A, for certain
U.S. individuals’ transactions with, and
ownership of, certain tax-favored foreign
trusts that are established and operated
exclusively or almost exclusively to
provide pension or retirement benefits,
or to provide medical disability or
educational benefits. This does not
affect any reporting obligations under
section 6038D.
Specified domestic entity reporting.
Certain domestic corporations,
partnerships, and trusts that are
considered formed or availed of for the
purpose of holding, directly or indirectly,
specified foreign financial assets
(specified domestic entities) must file
Form 8938 if the total value of those
assets exceeds $50,000 on the last day
of the tax year or $75,000 at any time
during the tax year.
For more information on domestic
corporations, partnerships, and trusts
that are specified domestic entities and
must file Form 8938, and the types of
specified foreign financial assets that
Nov 05, 2021

General Instructions

Purpose of Form

Use Form 8938 to report your specified
foreign financial assets if the total value
of all the specified foreign financial
assets in which you have an interest is
more than the appropriate reporting
threshold. See Types of Reporting
Thresholds, later.

Filing Form 8938 does not
relieve you of the requirement to
CAUTION file FinCEN Form 114, Report of
Foreign Bank and Financial Accounts
(FBAR), if you are otherwise required to
file the FBAR. See FinCEN Form 114
and its instructions for FBAR filing
requirements. Go to IRS.gov/
Businesses/Comparison-of-Form-8938and-FBAR-Requirements for a chart
comparing Form 8938 and FBAR filing
requirements.

!

When and How To File

Attach Form 8938 to your annual return
and file by the due date (including
extensions) for that return.
You must specify the applicable
calendar year or tax year to
CAUTION which your Form 8938 relates in
the appropriate space(s) at the top of
the form.

!

An annual return includes the
following returns.
• Form 1040.
• Form 1040-NR.
• Form 1040-SR.
• Form 1041.
• Form 1041-N.
• Form 1065.
• Form 1120.
A reference to an “annual return” or
“income tax return” in these instructions
includes a reference to any return listed
here, whether it is an income tax return
or an information return.

Cat. No. 55389W

!

CAUTION

return.

Who Must File

Unless an exception applies, you must
file Form 8938 if you are a specified
person (see Specified Person, later) that
has an interest in specified foreign
financial assets and the value of those
assets is more than the applicable
reporting threshold.
If you are required to file Form 8938,
you must report the specified foreign
financial assets in which you have an
interest even if none of the assets
affects your tax liability for the year. See
Specified Individual, Specified Domestic
Entity, and Types of Reporting
Thresholds, later.
Exception if no income tax

TIP return required. If you do not

have to file an income tax return
for the tax year, you do not have to file
Form 8938, even if the value of your
specified foreign financial assets is
more than the appropriate reporting
threshold.

Specified Person

A specified person is either a specified
individual or a specified domestic entity,
defined later.

Specified Individual
You are a specified individual if you are
one of the following.
• A U.S. citizen.
• A resident alien of the United States
for any part of the tax year (but see
Reporting Period, later).
• A nonresident alien who makes an
election to be treated as a 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, Tax Guide
for Individuals With Income From U.S.
Possessions, for a definition of bona
fide resident.
Resident aliens. You are a resident
alien if you are treated as a resident
alien for U.S. tax purposes under the
green card test or the substantial

presence test. For more information,
see Pub. 519, U.S. Tax Guide for
Aliens. If you qualify as a resident alien
under either rule, you are a specified
individual.
Special rule for dual resident taxpayers. If you are a dual resident taxpayer
(within the meaning of Regulations
section 301.7701(b)-7(a)(1)), who
determines his or her income tax liability
for all or a part of the tax year as if he or
she were a nonresident alien as
provided by Regulations section
301.7701(b)-7, file Form 8938 as
follows.

Percentage of passive assets held by a
corporation or partnership, later).
• A domestic trust described in section
7701(a)(30)(E) that has one or more
specified persons (a specified individual
or a specified domestic entity) as a
current beneficiary.
Closely held domestic corporation.
A domestic corporation is closely held if,
on the last day of the corporation’s tax
year, a specified individual directly,
indirectly, or constructively owns at least
80% of the total combined voting power
of all classes of stock of the corporation
entitled to vote or at least 80% of the
total value of the stock of the
corporation.

substantially all the corporation’s or
partnership’s commodities are property
described in paragraph (1), (2), or (8) of
section 1221(a);
• The excess of foreign currency gains
over foreign currency losses (as defined
in section 988(b)) attributable to any
section 988 transaction; and
• Net income from notional principal
contracts.

DRAFT AS OF
November 5, 2021

Specified individual filing as a
nonresident alien at the end of his or
her tax year. You are not required to
report specified foreign financial assets
on Form 8938 for the part of your tax
year covered by Form 1040-NR,
provided you comply with the filing
requirements of Regulations section
301.7701(b)-7(b) and (c), including the
requirement to timely file Form
1040-NR, as applicable, and attach
Form 8833, Treaty-Based Return
Position Disclosure Under Section 6114
or 7701(b).

Specified individual filing as a
resident alien at the end of his or her
tax year. You are not required to
report specified foreign financial assets
on Form 8938 for the part of your tax
year reflected on the schedule to Form
1040 or 1040-SR required by
Regulations section 1.6012-1(b)(2)(ii)
(a), provided you comply with the filing
requirements of Regulations section
1.6012-1(b)(2)(ii)(a), including the
requirement to timely file Form 1040 or
1040-SR and attach a properly
completed Form 8833.

Specified Domestic Entity
You are a specified domestic entity if
you are one of the following.
• A closely held domestic corporation
that has at least 50% of its gross income
from passive income.
• A closely held domestic corporation if
at least 50% of its assets produce or are
held for the production of passive
income (see Passive income and
Percentage of passive assets held by a
corporation or partnership, later).
• A closely held domestic partnership
that has at least 50% of its gross income
from passive income.
• A closely held domestic partnership if
at least 50% of its assets produce or are
held for the production of passive
income (see Passive income and

Closely held domestic partnership.
A domestic partnership is closely held if,
on the last day of the partnership’s tax
year, a specified individual directly,
indirectly, or constructively holds at
least 80% of the capital or profits
interest in the partnership.
Constructive ownership. Sections
267(c) and (e)(3) apply for purposes of
determining a specified individual’s
constructive ownership in a domestic
corporation or partnership, except that
section 267(c)(4) is applied as if the
family of an individual includes the
spouses of the specified individual’s
family members.

Passive income. Passive income
means the part of gross income that
consists of:
• Dividends, including substitute
dividends;
• Interest;
• Income equivalent to interest,
including substitute interest;
• Rents and royalties, other than rents
and royalties derived in the active
conduct of a trade or business
conducted, at least in part, by
employees of the corporation or
partnership;
• Annuities;
• The excess of gains over losses from
the sale or exchange of property
described in Regulations section
1.6038D-6(b)(3)(i)(F) and that gives rise
to the types of passive income listed
above;
• The excess of gains over losses from
transactions (including futures,
forwards, and similar transactions) in
any commodity, but not including:
1. Any commodity hedging
transaction described in section 954(c)
(5)(A), or
2. Active business gains or losses
from the sale of commodities, but only if
-2-

Exception from passive income
treatment for dealers. In the case of a
domestic corporation or partnership
regularly acting as a dealer in property
described in Regulations section
1.6038D-6(b)(3)(i)(F), forward
contracts, options contracts, or similar
financial instruments (including notional
principal contracts and all instruments
referenced to commodities), passive
income does not include the following.
1. Any item of income or gain (other
than any dividends or interest) from any
transaction (including hedging
transactions and transactions involving
physical settlement) entered into in the
ordinary course of such dealer’s trade or
business as such a dealer.
2. In the case of a corporation or
partnership that is a dealer in securities
(within the meaning of section 475(c)
(2)), any income from any transaction
entered into in the ordinary course of the
corporation’s or partnership’s trade or
business as a dealer in securities.

Passive income or assets of related
corporations and partnerships. For
purposes of determining whether a
domestic corporation or partnership
meets the passive income or asset test,
domestic corporations and domestic
partnerships that are closely held by the
same specified individual and that are
connected through stock or partnership
ownership with a common parent
corporation or partnership are treated as
owning the combined assets and
receiving the combined income of all
members of that group. For this
purpose, any contract, equity, or debt
existing between members of the group,
as well as any items of gross income
arising from that contract, equity, or
debt, is eliminated.
Connected stock or partnership
ownership. A domestic corporation or
partnership is considered connected
through stock or partnership interest
ownership with a common parent
corporation or partnership in the
following circumstances.
1. Stock representing at least 80%
of the total combined voting power of all
Instructions for Form 8938 (Rev. 11-2021)

classes of stock of the corporation
entitled to vote or of the value of such
corporation, other than stock of the
common parent, is owned by one or
more of the other connected
corporations, connected partnerships,
or the common parent.
2. Partnership interests
representing at least 80% of the profits
interests or capital interests of the
partnership, other than partnership
interests in the common parent, is
owned by one or more of the other
connected corporations, connected
partnerships, or the common parent.

DC’s weighted passive asset percentage for
tax year 2021 is 40%, that is, DC’s total passive
assets divided by its total assets ($800 / $2,000
= 40%). Because fewer than 50% of DC’s
assets produce or are held for the production of
passive income and less than 50% of DC’s
gross income for its tax year is passive income,
DC does not meet the passive asset or passive
income threshold and would not be a specified
domestic entity.

c. A domestic corporation described
in section 1473(3)(A) or (B), and the
regulations issued with respect to those
provisions.
2. The trustee has supervisory
authority over or fiduciary obligations
with regard to the specified foreign
financial assets held by the trust.
3. The trustee files annual returns
and information returns by the due date
(including any applicable extensions) on
behalf of the trust.

DRAFT AS OF
November 5, 2021

Percentage of passive assets held
by a corporation or partnership. For
purposes of determining whether at
least 50% of your assets produce or are
held for the production of passive
income, the percentage of passive
assets held by the corporation or
partnership for a tax year is the
weighted average percentage of
passive assets (weighted by total assets
and measured quarterly). The value of
assets of the corporation or partnership
is the fair market value or the book
value. The book value of assets is the
amount reflected on the corporation’s or
partnership’s balance sheet and may be
determined under either a U.S. or an
international financial accounting
standard. See Example 1 below, which
illustrates the application of this
weighted average asset rule.
Example 1. Application of the
weighted average asset rule. The
following example illustrates the
application of the weighted average
asset rule.
DC is a domestic corporation, the total value of
the stock of which is owned by L, a specified
individual. DC is a calendar year taxpayer.
Less than 50% of DC’s gross income for its tax
year beginning January 1, 2021, is passive
income. DC has the following assets in 2021,
measured quarterly:

Passive Assets

Total Assets

Q1

$150

$200

Q2

$150

$300

Q3

$300

$500

Q4

$200

$1,000

Tax Year
Totals

$800

$2,000

Instructions for Form 8938 (Rev. 11-2021)

Domestic trusts. A trust described in
section 7701(a)(30)(E) is considered a
specified domestic entity if and only if
the trust has one or more specified
persons (a specified individual or a
specified domestic entity) as a current
beneficiary for the tax year.

Current beneficiary. With respect
to a tax year, a current beneficiary is any
person who at any time during the tax
year is entitled to, or at the discretion of
any person may receive, a distribution
from the principal or income of the trust
(determined without regard to any
power of appointment to the extent that
such power remains unexercised at the
end of the tax year).

Special rule for general powers of
appointment. A current beneficiary
also includes any holder of a general
power of appointment, whether or not
exercised, that was exercisable at any
time during the tax year. A holder of a
general power of appointment that is
exercisable only on the death of the
holder is not a current beneficiary.

Excepted Specified Domestic
Entities
Entities described in section
1473(3). An entity described in section
1473(3) and the regulations thereunder,
with the exception of a trust that is
exempt from tax under section 664(c), is
not a specified domestic entity.
Certain domestic trust. A trust
described in section 7701(a)(30)(E) is
not considered a specified domestic
entity, provided that all of the following
apply.
1. The trustee is:
a. A bank that is examined by the
Office of the Comptroller of the
Currency, the Board of Governors of the
Federal Reserve System, the Federal
Deposit Insurance Corporation, or the
National Credit Union Administration;
b. A financial institution that is
registered with and regulated or
examined by the Securities and
Exchange Commission; or
-3-

Domestic trusts owned by one or
more specified persons. A trust
described in section 7701(a)(30)(E) to
the extent the trust or any part of the
trust is treated as owned by one or more
specified persons under sections 671
through 678 and the regulations.

Types of Reporting Thresholds
Reporting Thresholds Applying to
Specified Individuals
If you are a specified individual, your
applicable reporting threshold depends
upon whether you are married, file a
joint federal income tax return, and live
inside (or outside) the United States.
Taxpayers living in the United
States. If you do not live outside the
United States, you satisfy the reporting
threshold discussed next that applies to
you, and no exception applies, file Form
8938 with your income tax return.
Unmarried taxpayers. If you are
not married, you satisfy the reporting
threshold only if 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. If you are married
and you and your spouse file a joint
income tax return, you satisfy the
reporting threshold only if 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. If you are married
and file a separate income tax return
from your spouse, you satisfy the
reporting threshold only if 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.
Taxpayers living outside the United
States. If your tax home is in a foreign

country, you meet one of the presence
abroad tests described next, and no
exception applies, file Form 8938 with
your income tax return if you satisfy the
reporting threshold discussed next that
applies to you.
Unmarried taxpayers. If you are
not married, you satisfy the reporting
threshold only if the total value of your
specified foreign financial assets is
more than $200,000 on the last day of
the tax year or more than $300,000 at
any time during the tax year.

financial asset, see Interests in
Specified Foreign Financial Assets,
later.

Valuing Specified Foreign
Financial Assets
The value of a specified foreign financial
asset for purposes of determining the
total value of specified foreign financial
assets in which you have an interest
during the tax year or on the last day of
the tax year is the asset's fair market
value. For purposes of figuring the total
value of specified foreign financial
assets, the value of a specified foreign
financial asset denominated in a foreign
currency must first be determined in the
foreign currency and then converted to
U.S. dollars. See Foreign Currency
Conversion, later, for rules on
determining and applying the
appropriate foreign currency exchange
rate.

Asset With No Positive Value
If the maximum value of a specified
foreign financial asset is less than zero,
use a value of zero for the asset.

Joint Interest Valuation
If you jointly own an asset with someone
else, the value that you use to
determine the total value of all of your
specified foreign financial assets
depends on whether the other owner is
your spouse and, if so, whether your
spouse is a specified individual and
whether you file a joint or separate
return.

DRAFT AS OF
November 5, 2021

Married taxpayers filing a joint
income tax return. If you are married
and you and your spouse file a joint
income tax return, you satisfy the
reporting threshold only if the total value
of your specified foreign financial assets
is more than $400,000 on the last day of
the tax year or more than $600,000 at
any time during the tax year.
Married taxpayers filing separate
income tax returns. If you are married
and file a separate income tax return
from your spouse, you satisfy the
reporting threshold only if the total value
of your specified foreign financial assets
is more than $200,000 on the last day of
the tax year or more than $300,000 at
any time during the tax year.
Presence abroad. You satisfy the
presence abroad test if you are one of
the following.
• A U.S. citizen who has been a bona
fide resident of a foreign country or
countries for an uninterrupted period
that includes an entire tax year.
• A U.S. citizen or resident who is
present in a foreign country or countries
at least 330 full days during any period
of 12 consecutive months that ends in
the tax year being reported.

Reporting Thresholds Applying to
Specified Domestic Entities
If you are a specified domestic entity,
you satisfy the reporting threshold only if
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.

Determining the Total Value of
Your Specified Foreign
Financial Assets

You must figure the total value of the
specified foreign financial assets in
which you have an interest to determine
if you satisfy the reporting threshold that
applies to you. To determine if you have
an interest in a specified foreign

Value of an Interest in a Foreign
Trust During the Tax Year
If you do not know or have reason to
know based on readily accessible
information the fair market value of your
interest in a foreign trust during the tax
year, the value to be included in
determining the total value of your
specified foreign financial assets during
the tax year is the maximum value of
your interest in the foreign trust. See
Valuing Interests in Foreign Trusts,
later, for rules on determining the
maximum value of an interest in a
foreign trust.

Value of an Interest in a Foreign
Estate, Foreign Pension Plan, and
Foreign Deferred Compensation
Plan
If you do not know or have reason to
know based on readily accessible
information the fair market value of your
interest in a foreign estate, foreign
pension plan, or foreign deferred
compensation plan during the tax year,
the value to be included in determining
the total value of your specified foreign
financial assets during the tax year is
the fair market value, determined as of
the last day of the tax year, of the
currency and other property distributed
during the tax year to you. If you
received no distributions during the tax
year and do not know or have reason to
know based on readily accessible
information the fair market value of your
interest, use a value of zero for the
interest.
-4-

Joint ownership with spouse filing
joint income tax return. If you and
your spouse file a joint income tax return
and, therefore, would file one combined
Form 8938 for the tax year, include the
value of the asset jointly owned with
your spouse only once to determine the
total value of all of the specified foreign
financial assets you and your spouse
own.
Joint ownership with spouse filing
separate income tax return. If you
and your spouse are specified
individuals and you each file a separate
annual return, include one-half of the
value of the asset jointly owned with
your spouse to determine the total value
of all of your specified foreign financial
assets.
Joint ownership with a spouse who
is not a specified individual or someone other than a spouse. Each joint
owner includes the entire value of the
jointly owned asset to determine the
total value of all of that joint owner's
specified foreign financial assets.

Special Rules
Assets Reported on Another Form
Specified individual. If you are a
specified individual, include the value of
all specified foreign financial assets,
even if they are reported on another
form listed in Part IV to determine if you
satisfy the reporting threshold that
applies to you. See Part IV. Excepted
Specified Foreign Financial Assets,
later.
Specified domestic entity. If you are
a specified domestic entity, exclude the
value of any specified foreign financial
asset reported on another form listed in
Part IV to determine if you satisfy the
applicable reporting threshold.

Instructions for Form 8938 (Rev. 11-2021)

Bona Fide Resident of a U.S.
Possession
Do not include the value of specified
foreign financial assets you are not
required to report because you are a
bona fide resident of a U.S. possession.
See Bona Fide Resident of a U.S.
Possession under Assets Not Required
To Be Reported, later.

Example 4. I am not married and
do not live abroad. An unrelated U.S.
resident and I jointly own a specified
foreign financial asset valued at
$60,000. You each have to file Form
8938. You each satisfy the reporting
threshold of more than $50,000 on the
last day of the tax year.

specified foreign financial asset
valued at $60,000 for the entire year.
Neither you nor your spouse has to file
Form 8938. You each use one-half of
the value of the asset, $30,000, to
determine the total value of specified
foreign financial assets that you each
own. Neither of you satisfies the
reporting threshold of more than
$50,000 on the last day of the tax year
or more than $75,000 at any time during
the tax year.

DRAFT AS OF
November 5, 2021

Owners of Certain Domestic Trusts
Do not include the value of specified
foreign financial assets you are not
required to report because you are an
owner of a domestic widely held fixed
investment trust or a domestic
liquidating trust created under chapter 7
or chapter 11 of the Bankruptcy Code.
See Domestic Investment Trusts and
Domestic Bankruptcy Trusts, later.

Related Domestic Corporations
and Partnerships
To determine if you satisfy the
applicable reporting threshold, a
specified domestic entity that is a
corporation or partnership and that has
an interest in any specified foreign
financial asset is treated as owning all
specified foreign financial assets held
by all related corporations or
partnerships that are closely held by the
same specified individual (excluding
specified foreign financial assets that
are excluded from reporting under Part
IV of Form 8938 or because you are the
owner of a domestic widely held fixed
investment trust or a domestic
liquidating trust created under chapter 7
or chapter 11 of the Bankruptcy Code).
Examples 2 through 11 may help you
decide if you have to file Form 8938.
Example 2. I am not married and
do not live abroad. The total value of
my specified foreign financial assets
does not exceed $49,000 during the
tax year. You do not have to file Form
8938. You do not satisfy the reporting
threshold of more than $50,000 on the
last day of the tax year or more than
$75,000 at any time during the tax year.
Example 3. I am not married and
do not live abroad. I sold my only
specified foreign financial asset on
October 15, when its value was
$125,000. You have to file Form 8938.
You satisfy the reporting threshold even
though you do not hold any specified
foreign financial assets on the last day
of the tax year because you did own
specified foreign financial assets of
more than $75,000 at any time during
the tax year.
Instructions for Form 8938 (Rev. 11-2021)

Example 5. I am not married and
do not live abroad. I own an entity
disregarded for tax purposes, which
owns one specified foreign financial
asset valued at $30,000. In addition,
I own a specified foreign financial
asset valued at $25,000. You have to
file Form 8938. You own both the
specified foreign financial asset owned
by the disregarded entity and the
specified foreign financial asset you
own directly, for a total value of
$55,000. You satisfy the reporting
threshold of more than $50,000 on the
last day of the tax year.
Example 6. My spouse and I do
not live abroad. We file a joint
income tax return and jointly own a
single specified foreign financial
asset valued at $60,000. You and
your spouse do not have to file Form
8938. You do not satisfy the reporting
threshold of more than $100,000 on the
last day of the tax year or more than
$150,000 at any time during the tax
year.

Example 7. My spouse and I do
not live abroad. We file a joint
income tax return, and jointly and
individually own specified foreign
financial assets. On the last day of
the tax year, my spouse and I jointly
own a specified foreign financial
asset with a value of $90,000. My
spouse has a separate interest in a
specified foreign financial asset with
a value of $10,000. I have a separate
interest in a specified foreign
financial asset with a value of
$1,000. You and your spouse have to
file a combined Form 8938. You and
your spouse have an interest in
specified foreign financial assets in the
amount of $101,000 on the last day of
the tax year. This is the entire value of
the specified foreign financial asset that
you jointly own, $90,000, plus the value
of the asset that your spouse separately
owns, $10,000, plus the value of the
asset that you separately own, $1,000.
You and your spouse satisfy the
reporting threshold of more than
$100,000 on the last day of the tax year.
Example 8. My spouse and I do
not live abroad. We file separate
income tax returns and jointly own a
-5-

Example 9. My spouse and I file
separate income tax returns, jointly
and individually own specified
foreign financial assets, and do not
live abroad. On the last day of the
tax year, my spouse and I jointly
own a specified foreign financial
asset with a value of $90,000. My
spouse has a separate interest in a
specified foreign financial asset with
a value of $10,000. I have a separate
interest in a specified foreign
financial asset with a value of
$1,000. You do not have to file Form
8938 but your spouse does. Your
spouse has an interest in specified
foreign financial assets in the amount of
$55,000 on the last day of the tax year.
This is one-half of the value of the asset
that you jointly own, $45,000, plus the
entire value of the asset that your
spouse separately owns, $10,000. You
have an interest in specified foreign
financial assets in the amount of
$46,000 on the last day of the tax year.
This is one-half of the value of the asset
that you jointly own, $45,000, plus the
entire value of the asset that you
separately own, $1,000. Your spouse
satisfies the reporting threshold of more
than $50,000 on the last day of the tax
year. You do not satisfy the reporting
threshold of more than $50,000 on the
last day of the tax year or more than
$75,000 at any time during the tax year.
Example 10. My spouse and I are
U.S. citizens but live abroad for the
entire tax year and file a joint income
tax return. The total value of our
combined specified foreign financial
assets on any day of the tax year is
$150,000. You and your spouse do not
have to file Form 8938. You do not
satisfy the reporting threshold of more
than $400,000 on the last day of the tax
year or more than $600,000 at any time
during the tax year for married
individuals who live abroad and file a
joint income tax return.
Example 11. My spouse and I live
abroad and file separate income tax
returns. My spouse is not a specified
individual. On the last day of the tax

year, my spouse and I jointly own a
specified foreign financial asset with
a value of $150,000. My spouse has
a separate interest in a specified
foreign financial asset with a value
of $10,000. I have a separate interest
in a specified foreign financial asset
with a value of $60,000. You have to
file Form 8938 but your spouse, who is
not a specified individual, does not. You
have an interest in specified foreign
financial assets in the amount of
$210,000 on the last day of the tax year.
This is the entire value of the asset that
you jointly own, $150,000, plus the
entire value of the asset that you
separately own, $60,000. You satisfy
the reporting threshold for a married
individual living abroad and filing a
separate return of more than $200,000
on the last day of the tax year.

insurance company or other foreign
financial institution. A specified foreign
financial asset includes a financial
account maintained by a financial
institution that is organized under the
laws of a U.S. possession (American
Samoa, Guam, the Commonwealth of
the Northern Mariana Islands, Puerto
Rico, or the U.S. Virgin Islands).

If you are required to file Form
8938, in addition to reporting
CAUTION retirement and pension
accounts and nonretirement savings
accounts described in Regulations
section 1.1471-5(b)(2)(i), you must
report retirement and pension accounts,
nonretirement savings accounts, and
accounts satisfying conditions similar to
those described in Regulations section
1.1471-5(b)(2)(i) that are otherwise
excluded from the definition of a
financial account by an applicable
Model 1 IGA or Model 2 IGA. Thus,
such accounts are subject to uniform
reporting rules and must be reported
without regard to whether the account is
maintained in a jurisdiction with an IGA.

!

DRAFT AS OF
November 5, 2021

Specified Foreign
Financial Assets
Types of Specified Foreign
Financial Assets

Specified foreign financial assets
include the following assets.
1. Financial accounts maintained by
a foreign financial institution.
2. The following foreign financial
assets if they are held for investment
and not held in an account maintained
by a financial institution.
a. Stock or securities issued by
someone that is not a U.S. person
(including stock or securities issued by
a person organized under the laws of a
U.S. possession).
b. Any interest in a foreign entity.
c. Any financial instrument or
contract that has an issuer or
counterparty that is not a U.S. person
(including a financial contract issued by,
or with a counterparty that is, a person
organized under the laws of a U.S.
possession).
For foreign financial assets excepted
from reporting, see Assets Not Required
To Be Reported, later.

Financial Account
A financial account is any depository or
custodial account (under Regulations
section 1.1471-5(b)(1)(i) or (ii))
maintained by a foreign financial
institution as well as any equity or debt
interest in a foreign financial institution
(other than interests that are regularly
traded on an established securities
market) or any cash value life insurance
or annuity contract maintained by an

Foreign financial institution. In most
cases, a foreign financial institution is
any financial institution that is not a U.S.
entity and satisfies one or more of the
following.
• It accepts deposits in the ordinary
course of a banking or similar business.
• It holds financial assets for the
account of others as a substantial part
of its business.
• It is engaged (or holds itself out as
being engaged) primarily in the
business of investing, reinvesting, or
trading in securities, partnership
interests, commodities, or any interest
(including a futures or forward contract
or option) in such securities, partnership
interests, or commodities.

Other Specified Foreign Financial
Assets
Examples of other specified foreign
financial assets include the following, if
they are held for investment and not
held in a financial account.
• Stock issued by a foreign corporation.
• A capital or profits interest in a foreign
partnership.
• A note, bond, debenture, or other
form of indebtedness issued by a
foreign person.
• An interest in a foreign trust or foreign
estate.
• An interest rate swap, currency swap,
basis swap, interest rate cap, interest
rate floor, commodity swap, equity
swap, equity index swap, credit default
swap, or similar agreement with a
foreign counterparty.
• An option or other derivative
instrument with respect to any of these
examples or with respect to any
currency or commodity that is entered
into with a foreign counterparty or
issuer.
Assets held for investment. You hold
an asset, including a partnership
interest, for investment if you do not use
it in, or hold it for use in, the conduct of
any trade or business.
Stock is not considered used or held
for use in the conduct of a trade or
business.

-6-

Interests in Specified Foreign
Financial Assets

You have an interest in a specified
foreign financial asset if any income,
gains, losses, deductions, credits, gross
proceeds, or distributions from holding
or disposing of the asset are or would
be required to be reported, included, or
otherwise reflected on your income tax
return.
You have an interest in a specified
foreign financial asset even if no
income, gains, losses, deductions,
credits, gross proceeds, or distributions
from holding or disposing of the asset
are included or reflected on your income
tax return for this tax year.

Interests in Property Transferred
in Connection With the
Performance of Services
You are first considered to have an
interest in property transferred in
connection with the performance of
services on the first date that the
property is substantially vested (within
the meaning of Regulations section
1.83-3(b)) or, if you have made a valid
section 83(b) election with respect to
the property, on the date of transfer of
the property.

Interests in Assets Held by
Disregarded Entities
If you are the owner of a disregarded
entity, you have an interest in any
specified foreign financial assets owned
by the disregarded entity.

Interests in Jointly Owned Assets
A joint owner of an asset has an interest
in the entire asset. For special rules for
interests in assets jointly owned by
Instructions for Form 8938 (Rev. 11-2021)

spouses, see Joint Interest Valuation,
earlier, and Reporting the Value of
Jointly Owned Assets, later.

Interests in Foreign Pension Plans
and Foreign Deferred
Compensation Plans

Interests in Assets Held in
Financial Accounts

Report in Part VI your interest in the
foreign pension plan or foreign deferred
compensation plan. Do not separately
report the assets held by the plan. See
Valuing Interests in Foreign Estates,
Foreign Pension Plans, and Foreign
Deferred Compensation Plans, later.

If you have an interest in a financial
account that holds specified foreign
financial assets, you do not have to
report the assets held in the account.

during the tax year, the maximum value
of the asset must be determined in the
foreign currency and then converted to
U.S. dollars.
In most cases, you must use the U.S.
Treasury Bureau of the Fiscal Service
foreign currency exchange rate for
purchasing U.S. dollars. You can find
this rate on fiscal.treasury.gov/
fsreports/rpt/treasRptRateExch/
treasRptRateExch_home.htm. If no U.S.
Treasury Bureau of the Fiscal Service
exchange rate is available, you must
use another publicly available foreign
currency exchange rate for purchasing
U.S. dollars and disclose the rate on
Form 8938.

DRAFT AS OF
November 5, 2021

Interests in Assets Generating
Certain Unearned Income of
Children

If you file Form 8814, Parents' Election
To Report Child's Interest and
Dividends, with your income tax return
to elect to include in your gross income
certain unearned income of your child
(the “kiddie tax” election), you have an
interest in any specified foreign financial
asset held by the child.

Interests in Assets Held by Entities
That Are Not Disregarded Entities
In most cases, you do not own an
interest in any specified foreign financial
asset held by a partnership, corporation,
trust, or estate solely as a result of your
status as a partner, shareholder, or
beneficiary.

Interests in Assets Held by
Grantor Trust
If you are considered the owner under
the grantor trust rules (sections 671
through 679) of any part of a trust, you
have an interest in any specified foreign
financial asset held by that part of the
trust you are considered to own. For
exceptions from reporting for owners of
certain domestic investment or
bankruptcy trusts, see Domestic
Investment Trusts and Domestic
Bankruptcy Trusts, later.

Interests in Foreign Estates and
Foreign Trusts
An interest in a foreign trust or a foreign
estate is not a specified foreign financial
asset unless you know or have reason
to know based on readily accessible
information of the interest. If you receive
a distribution from the foreign trust or
foreign estate, you are considered to
know of the interest.

Reporting Period

Unless an exception applies, the
reporting period for Form 8938 is your
tax year.

Exception for Partial Tax Years
of Specified Individuals

If you are a specified individual for less
than the entire tax year, the reporting
period is the part of the year that you are
a specified individual.
Example 12. John is a calendar
year taxpayer. The Form 8938 reporting
period begins on January 1 and ends on
December 31.
Example 13. Agnes was a single
calendar year taxpayer who died on
March 6. The Form 8938 reporting
period begins on January 1 and ends on
March 6.
Example 14. George, a calendar
year taxpayer, is not a U.S. citizen or
married. George arrived in the United
States on February 1 and satisfied the
substantial presence test for the tax
year. The Form 8938 reporting period
begins on George's U.S. residency
starting date, February 1, and ends on
December 31.

Reporting Maximum Value

You must report the maximum value
during the tax year of each specified
foreign financial asset reported on Form
8938. In most cases, the value of a
specified foreign financial asset is its fair
market value. An appraisal by a third
party is not necessary to estimate the
maximum fair market value during the
year. See Valuing Financial Accounts
and Valuing Other Specified Foreign
Financial Assets, later.

Assets With No Positive Value

If the maximum value of a specified
foreign financial asset is less than zero,
use a value of zero as the maximum
value of the asset.

Foreign Currency Conversion

If your specified foreign financial asset
is denominated in a foreign currency
Instructions for Form 8938 (Rev. 11-2021)

-7-

Currency Determination Date

Use the currency exchange rate on the
last day of the tax year to figure the
maximum value of a specified foreign
financial asset or the value of a
specified foreign financial asset for the
purpose of determining the total value of
your specified foreign financial assets to
see whether you have met the reporting
threshold. Use this rate even if you sold
or otherwise disposed of the specified
foreign financial asset before the last
day of the tax year.

Exception for Financial Account
Statement Currency Conversion
Rate
You may rely on the foreign currency
conversion rate reflected in a financial
account statement issued at least
annually by the financial institution
maintaining the account.

Reporting the Value of Jointly
Owned Assets
If you own an asset jointly with one or
more persons, you must report the
asset's maximum value as follows.

Married Specified Individuals
Filing a Joint Income Tax Return
If you are married and you and your
spouse file a joint income tax return,
report any specified foreign financial
asset that you jointly own only once and
include the maximum value of the entire
asset (and not just the maximum value
of your interest in the asset). Also, you
must report any specified foreign
financial asset that you or your spouse
separately owns and include the
maximum value of the entire asset. If
you and your spouse file a joint income
tax return that includes Form 8814, you
must report any specified foreign
financial asset your child owns only

once and include the maximum value of
the entire asset.

Married Specified Individuals
Filing Separate Income Tax
Returns
If you are married and you and your
spouse are specified individuals who file
separate income tax returns, both you
and your spouse report any specified
foreign financial asset that you jointly
own on your separate Forms 8938, and
both you and your spouse must include
the maximum value of the entire asset
on your separate Forms 8938. You must
also report any specified foreign
financial asset that you own individually
on your separate Form 8938 and
include the maximum value of the entire
asset. If you file Form 8814, you must
report any specified foreign financial
asset your child owns and include the
maximum value of the entire asset.

is readily available, the 52-week high
trading price for the stock results in
a maximum value of the stock during
the tax year of $150,000. If you are
required to file Form 8938, the
maximum value of the foreign stock to
be reported is $150,000, based on
readily available information of the
stock’s maximum value during the tax
year.

1. A financial account that is
maintained by a U.S. payer, such as a
domestic financial institution. In general,
a U.S. payer also includes a domestic
branch of a foreign bank or foreign
insurance company and a foreign
branch or foreign subsidiary of a U.S.
financial institution. Examples of
financial accounts maintained by U.S.
financial institutions include:
• U.S. mutual funds accounts,
• IRAs (traditional or Roth),
• Section 401(k) retirement accounts,
• Qualified U.S. retirement plans, and
• Brokerage accounts maintained by
U.S. financial institutions.
2. A financial account that is
maintained by a dealer or trader in
securities or commodities if all of the
holdings in the account are subject to
the mark-to-market accounting rules for
dealers in securities or an election
under section 475(e) or (f) is made for
all of the holdings in the account.

DRAFT AS OF
November 5, 2021

Other Joint Ownership
If you are a joint owner of a specified
foreign financial asset and you cannot
use one of the special rules for married
individuals who file a joint tax return, you
must report the specified foreign
financial asset and include the
maximum value of the entire asset.

Valuing Financial Accounts

You may rely on periodic account
statements for the tax year to report a
financial account's maximum value
unless you know or have reason to
know based on readily accessible
information that the statements do not
reflect a reasonable estimate of the
maximum account value during the tax
year.

Valuing Other Specified
Foreign Financial Assets

In most cases, you may use the value of
a specified foreign financial asset that is
not a financial account and that is held
for investment and not held in an
account maintained by a financial
institution as of the last day of the tax
year, unless you know or have reason to
know based on readily accessible
information that the value does not
reflect a reasonable estimate of the
maximum value of the asset during the
tax year.
Example 15. I have publicly
traded foreign stock not held in a
financial account that has a fair
market value as of the last day of the
tax year of $100,000, although,
based on daily price information that

Valuing Interests in Foreign
Trusts

If you are a beneficiary of a foreign trust,
the maximum value of your interest in
the trust is the sum of the following
amounts.
• The value of all of the cash or other
property distributed during the tax year
from the trust to you as a beneficiary.
• The value using the valuation tables
under section 7520 of your right as a
beneficiary to receive mandatory
distributions as of the last day of the tax
year.

Valuing Interests in Foreign
Estates, Foreign Pension Plans,
and Foreign Deferred
Compensation Plans

If you have an interest in a foreign
estate, foreign pension plan, or foreign
deferred compensation plan, the
maximum value of your interest is the
fair market value of your beneficial
interest in the assets of the estate,
pension plan, or deferred compensation
plan as of the last day of the tax year. If
you do not know or have reason to know
based on readily accessible information
the fair market value as of the last day of
the tax year, the maximum value is the
fair market value, determined as of the
last day of the tax year, of the cash and
other property distributed during the tax
year to you as a beneficiary or
participant. If you received no
distributions during the tax year and do
not know or have reason to know based
on readily accessible information the fair
market value of your interest as of the
last day of the tax year, use a value of
zero as the maximum value of the asset.

Assets Not Required To
Be Reported

You are not required to report the
following assets.

Certain Financial Accounts

The following financial accounts and the
assets held in such accounts are not
specified foreign financial assets and do
not have to be reported on Form 8938.
-8-

Certain Financial Assets

You do not have to report any asset that
is not held in a financial account if the
asset is subject to the mark-to-market
accounting rules for dealers in securities
or commodities or an election under
section 475(e) or (f) is made for the
asset.

Foreign Equivalent of Social
Security

Payments or the rights to receive the
foreign equivalent of social security (as
defined for U.S. tax purposes), social
insurance benefits, or another similar
program of a foreign government are
not specified foreign financial assets
and are not reportable. The foreign
equivalent of social security does not
include an interest in a foreign pension
plan, which, as described above, is
subject to section 6038D reporting.

Exceptions To Reporting
Duplicative Reporting
You do not have to report any asset on
Form 8938 if you report it on one or
more of the following forms that you
timely file with the IRS for the same tax
year.
• Form 3520, Annual Return To Report
Transactions With Foreign Trusts and
Receipt of Certain Foreign Gifts (in the
case of a specified person who is a
beneficiary of a foreign trust, see Part III
of Form 3520 and its instructions).
• Form 5471, Information Return of
U.S. Persons With Respect to Certain
Foreign Corporations.
Instructions for Form 8938 (Rev. 11-2021)

• Form 8621, Information Return by a
Shareholder of a Passive Foreign
Investment Company or Qualified
Electing Fund.
• Form 8865, Return of U.S. Persons
With Respect to Certain Foreign
Partnerships.

Domestic Investment Trusts
If you are considered the owner under
the grantor trust rules (sections 671
through 679) of any part of a domestic
widely held fixed investment trust under
Regulations section 1.671-5, you do not
have to report any specified foreign
financial asset held by the part of the
trust you are considered to own.

Penalties

You may be subject to penalties if you
fail to timely file a correct Form 8938 or
if you have an understatement of tax
relating to an undisclosed specified
foreign financial asset.

Failure-To-File Penalty

DRAFT AS OF
November 5, 2021

Instead, you must identify on Form
8938 the form(s) on which you report
the specified foreign financial asset and
how many of these forms you file. See
Part IV. Excepted Specified Foreign
Financial Assets, later.

Joint Form 5471 or Form 8865
Filers

If you are included as part of a joint
Form 5471 or Form 8865 filing and
provide the notification required by
Regulations section 1.6038-2(i) or
1.6038-3(c), you are considered to have
filed that form for purposes of the
requirement to report specified foreign
financial assets on Form 8938. See Part
IV. Excepted Specified Foreign
Financial Assets, later.

Foreign Grantor Trusts
If you are considered the owner under
the grantor trust rules (sections 671
through 679) of any part of a foreign
trust, you do not have to report any of
the specified foreign financial assets
held by the part of the trust you are
considered to own if you satisfy the
following conditions.
• You report the trust on a Form 3520
that you timely file with the IRS for the
same tax year. See Part III of Form 3520
and its instructions.
• You ensure that the trust timely files
Form 3520-A, Annual Information
Return of Foreign Trust With a U.S.
Owner, (or you timely file a substitute
Form 3520-A) with the IRS for the same
tax year. See Form 3520-A and its
instructions.
• You report the filing of Form 3520 and
3520-A on Form 8938.
Instead, you must identify on Form
8938 how many of these forms you file.
See Part IV. Excepted Specified Foreign
Financial Assets, later.
If you are a specified individual,
you must include the value of
CAUTION the assets reported on Forms
3520, 3520-A, 5471, 8621, and 8865 in
determining whether you satisfy the
reporting threshold that applies to you.
See Reporting Thresholds Applying to
Specified Individuals, earlier.

!

Instructions for Form 8938 (Rev. 11-2021)

Domestic Bankruptcy Trusts

If you are considered the owner under
the grantor trust rules (sections 671
through 679) of any part of a domestic
liquidating trust under Regulations
section 301.7701-4(d) that is created
under chapter 7 or chapter 11 of the
Bankruptcy Code, you do not have to
report any specified foreign financial
asset held by the part of the trust you
are considered to own.

Bona Fide Resident of a U.S.
Possession
If you are a bona fide resident of a U.S.
possession (American Samoa, Guam,
the Commonwealth of the Northern
Mariana Islands, Puerto Rico, or the
U.S. Virgin Islands), do not include the
value of the following assets to
determine if you satisfy the reporting
threshold that applies to you. If you are
required to file Form 8938, you do not
have to report the following specified
foreign financial assets on Form 8938.
• A financial account maintained by a
financial institution organized under the
laws of the U.S. possession of which
you are a bona fide resident.
• A financial account maintained by a
branch of a financial institution not
organized under the laws of the U.S.
possession of which you are a bona fide
resident, if the branch is subject to the
same tax and information reporting
requirements that apply to a financial
institution organized under the laws of
the U.S. possession of which you are a
bona fide resident.
• Stock or securities issued by an entity
organized under the laws of the U.S.
possession of which you are a bona fide
resident.
• An interest in an entity organized
under the laws of the U.S. possession of
which you are a bona fide resident.
• A financial instrument or contract held
for investment, provided each issuer or
counterparty that is not a U.S. person is
either an entity organized under the
laws of the U.S. possession of which
you are a bona fide resident or a bona
fide resident of the U.S. possession of
which you are a bona fide resident.
-9-

If you are required to file Form 8938 but
do not file a complete and correct Form
8938 by the due date (including
extensions), you may be subject to a
penalty of $10,000.

Continuing Failure To File

If you do not file a correct and complete
Form 8938 within 90 days after the IRS
mails you a notice of the failure to file,
you may be subject to an additional
penalty of $10,000 for each 30-day
period (or part of a period) during which
you continue to fail to file Form 8938
after the 90-day period has expired. The
maximum additional penalty for a
continuing failure to file Form 8938 is
$50,000.

Married Taxpayers Filing a Joint
Income Tax Return
If you are married and you and your
spouse file a joint income tax return, the
failure-to-file penalties apply as if you
and your spouse were a single person.
Your and your spouse’s liability for all
penalties is joint and several.

Presumption of Maximum Value
If the IRS determines that you have an
interest in one or more specified foreign
financial assets and asks you for
information about the value of any
asset, but you do not provide enough
information for the IRS to determine the
value of the asset, you are presumed to
own specified foreign financial assets
with a value of more than the reporting
threshold that applies to you. See
Determining the Total Value of Your
Specified Foreign Financial Assets,
earlier. In such case, you are subject to
the failure-to-file penalties if you do not
file Form 8938.

Reasonable Cause Exception
No penalty will be imposed if you fail to
file Form 8938 or to disclose one or
more specified foreign financial assets
on Form 8938 and the failure is due to
reasonable cause and not to willful
neglect. You must affirmatively show the
facts that support a reasonable cause
claim.

The determination of whether a
failure to disclose a specified foreign
financial asset on Form 8938 was due to
reasonable cause and not due to willful
neglect will be determined on a
case-by-case basis, taking into account
all pertinent facts and circumstances.
Effect of foreign jurisdiction laws.
The fact that a foreign jurisdiction would
impose a civil or criminal penalty on you
if you disclose the required information
is not reasonable cause.

and the amount you omit is more than
$5,000, any tax you owe for the tax year
can be assessed at any time within 6
years after you filed your return.
For this purpose, specified foreign
financial assets include any specified
foreign financial assets in which you
have an interest without regard to the
reporting threshold that applies to you
and regardless of any exception from
reporting a specified foreign financial
asset on Form 8938.

enter the entity’s employer identification
number (EIN).

Line 3

Indicate the type of filer by checking the
applicable box on line 3. If you are a
specified individual (see Specified
Individual, earlier), check box 3a. In the
case of a specified domestic entity (see
Specified Domestic Entity, earlier),
check the applicable box for partnership
(3b), corporation (3c), or trust (3d).

DRAFT AS OF
November 5, 2021

Accuracy-Related Penalty

If you underpay your tax as a result of a
transaction involving an undisclosed
specified foreign financial asset, you
may have to pay a penalty equal to 40%
of that underpayment.

Examples of underpayments due to
transactions involving an undisclosed
specified foreign financial asset include
the following.
• You do not report ownership of
shares in a foreign corporation on Form
8938 and you received taxable
distributions from the company that you
did not report on your income tax return.
• You do not report ownership of
shares in a foreign company on Form
8938 and you sold the shares in the
company for a gain and did not report
the gain on your income tax return.
• You do not report a foreign pension
on Form 8938 and you received a
taxable distribution from the pension
plan that you did not report on your
income tax return.

Fraud

If you underpay your tax due to fraud,
you must pay a penalty of 75% of the
underpayment due to fraud.

Criminal Penalties

In addition to the penalties already
discussed, if you fail to file Form 8938,
fail to report an asset, or have an
underpayment of tax, you may be
subject to criminal penalties.

Statute of Limitations

If you fail to file Form 8938 or fail to
report a specified foreign financial asset
that you are required to report, the
statute of limitations for the tax year may
remain open for all or a part of your
income tax return until 3 years after the
date on which you file Form 8938.

Extended Statute of Limitations for
Failure To Include Income
If you do not include in your gross
income an amount relating to one or
more specified foreign financial assets,

Specific Instructions

Before you begin. If you are a
specified individual and report all of your
specified foreign financial assets on a
timely filed Form 3520, 3520-A, 5471,
8621, or 8865, you do not have to report
them on Form 8938. Instead, enter your
name(s) and taxpayer identification
number (TIN) at the top of the form and
complete Part IV only. If you are a
specified individual or a specified
domestic entity and report only a part of
your specified foreign financial assets
on one or more of these forms, report
the remaining assets on Form 8938 and
complete Part IV.
Additional statements. If you have
more than one account or asset to
report in Part V or VI, or more than one
issuer or counterparty to report in Part
VI, make additional copies of page 2 of
this form and attach them to your form.
Check the box at the top of page 1 of
the form to indicate that you are
attaching additional statements, and
enter the number of additional
statements in the space provided.

Period Covered

For filing calendar year and fiscal year
returns, fill in the tax year of the
specified individual or specified
domestic entity for whom you are
furnishing information in the space at
the top of the form.

Identifying Information
Lines 1 and 2

Enter your name(s) and TIN as shown
on the annual return you are filing with
Form 8938. If you are a specified
individual (see Specified Individual,
earlier), enter the first TIN shown on
your income tax return. A TIN is a social
security number (SSN) or individual
taxpayer identification number (ITIN). In
the case of a specified domestic entity
(see Specified Domestic Entity, earlier),

-10-

Line 4

If you checked box 3a (specified
individual), do not complete this line 4. If
you checked box 3b (partnership) or 3c
(corporation), enter the name and TIN of
the specified individual (see Specified
Individual, earlier) who closely holds the
partnership or corporation. If you
checked box 3d (trust), enter the name
and TIN of the specified person (see
Specified Person, earlier) who is a
current beneficiary of the trust.
Note. If you are a paper filer and you
have more than one specified individual
or specified person, attach a statement
listing the name and TIN of each such
specified individual or specified person.
If you are a specified individual

TIP (see Specified Individual,

earlier) for less than the entire
tax year, you only have to report the
information for the part of the year that
you are a specified individual.

Part I. Foreign Deposit and
Custodial Accounts
Summary
Use Part I to summarize information
regarding foreign deposit and custodial
accounts reported in all Parts V.

Line 5

Report the number of deposit accounts
reported in all Parts V.

Line 6

Report the total maximum value of these
deposit accounts.

Line 7

Report the number of custodial
accounts reported in all Parts V.

Line 8

Report the total maximum value of these
custodial accounts.

Line 9

Indicate whether any foreign deposit or
custodial accounts were closed during
the tax year.

Instructions for Form 8938 (Rev. 11-2021)

Part II. Other Foreign
Assets Summary

Use Part II to summarize information
regarding financial accounts (other than
foreign deposit and custodial accounts)
and other specified foreign financial
assets reported in all Parts VI.

specified foreign financial assets held
by the trust. If you are a beneficiary of
the foreign trust, you may have to file
Form 8938 to report your interest in the
trust. You do not have to report on Form
8938 any specified foreign financial
asset held by the trust or your interest in
the trust if you report the trust on a Form
3520, you timely file for the tax year, and
the trust timely files Form 3520-A for the
tax year.

Joint Interests in Foreign
Deposit and Custodial
Accounts

Use the following rules to determine the
maximum value to report.

Spouses Filing a Joint Return

DRAFT AS OF
November 5, 2021

Line 10

Report the number of accounts and
assets reported in all Parts VI.

Line 11

Report the total maximum value of these
accounts and assets.

Line 12

Indicate whether any account was
opened or closed or any asset was
acquired or disposed of during the tax
year.

Part III. Summary of Tax
Items Attributable to
Specified Foreign
Financial Assets

Enter the following items for your total
assets reported in Part V or Part VI and
the schedule, form, or return on which
you reported the items.
• Interest.
• Dividends.
• Royalties.
• Other income.
• Gains or (losses).
• Deductions.
• Credits.

Part IV. Excepted
Specified Foreign
Financial Assets

If you reported a specified foreign
financial asset on certain other forms
listed below for the same tax year, you
may not have to report it on Form 8938.
However, you must identify the form
where you reported the asset by
indicating how many forms you filed.
For more information, see Duplicative
Reporting, earlier. If you reported a
specified foreign financial asset on one
or more of the following forms, enter the
number of forms filed.
• Form 3520.
• Form 3520-A.
• Form 5471.
• Form 8621.
• Form 8865.

Part V. Detailed
Information for Each
Foreign Deposit and
Custodial Account
Included in the Part I
Summary

Use Part V to report information for
foreign deposit and custodial accounts.
If you have more than one account,
attach an additional statement with the
required information for each additional
account and check the box at the top of
page 1 of the form.

Lines 20 Through 28

Enter the following information for each
foreign deposit or custodial account.

Line 20

Check the box to indicate if this is a
depository or a custodial account.

Line 21

Enter the account number of the
account or other specific identifying
information for the account if there is no
account number.

Line 22

Check one or more boxes to indicate if
any of the following applies.
• The account was opened during the
tax year.
• The account was closed during the
tax year.
• The account was jointly owned with
your spouse.
• You did not report any tax item in Part
III for this asset.

Line 23

Enter the maximum value of the account
during the tax year.
See Reporting Maximum Value,
TIP earlier, for information on
determining the maximum value
of the account.

Foreign Grantor Trusts

Spouses Filing Separate Returns

You and your spouse each report the
maximum value of an account held
jointly by you and your spouse on your
separate Forms 8938 filed with your
separate income tax returns.

Other Joint Owners
Report the maximum value of the entire
jointly held account on your Form 8938
filed with your income tax return,
regardless of the value of your separate
interest in the account.

Lines 24 and 25

If you used a foreign currency exchange
rate to convert the value of the account
into U.S. dollars, check the “Yes” box on
line 24 and go to line 25. Otherwise,
check the “No” box and go to line 26.

Line 25

If you answered “Yes” on line 24, enter
the following information.
1. The foreign currency in which the
account is maintained.
2. The foreign currency exchange
rate used to convert the value of the
account into U.S. dollars.
3. If the U.S. Treasury Bureau of the
Fiscal Service did not provide an
exchange rate, the source of the foreign
currency exchange rate that you used.
You must use the foreign
currency exchange rate on the
CAUTION last day of the tax year, even if
you closed or disposed of the account
before the last day of the tax year.

!

Line 26a

Enter the name of the financial
institution in which the account is
maintained.

Line 26b

If you have been furnished the Global
Intermediary Identification Number
(GIIN) associated with the financial
account listed on line 26a, enter it here.

If you are treated as an owner of any
part of a foreign grantor trust, you may
have to file Form 8938 to report
Instructions for Form 8938 (Rev. 11-2021)

You and your spouse report the
maximum value of an account held
jointly by you and your spouse only
once on the single Form 8938 filed with
your joint income tax return.

-11-

If you haven't been provided a GIIN
by your financial institution, you can look
it up by using the FATCA Foreign
Financial Institution (FFI) List Search
and Download tool. You can access the
tool at IRS.gov/Businesses/
Corporations/FATCA-Foreign-FinancialInstitution-List-Search-and-DownloadTool.

Line 30

Enter the identifying number or other
information identifying the account or
asset.

Line 31

Enter the following information about the
account or asset, if required.
1. If the account was opened or
closed, or the asset was acquired or
disposed of during the year, enter the
date of opening and/or closure, or
acquisition and/or disposition, as
applicable. If the assets were acquired
or disposed of during different dates in
the year, enter “Various.”
2. If you own the account or asset
jointly with your spouse, check the box
on line 31c.
3. If you did not report any income,
gain, loss, deduction, or credit for this
account or asset on your tax return or
any schedule or form attached to your
income tax return filed for the tax year,
check the box on line 31d.

separate interest in the account or
asset.

Lines 33 and 34

If you used a foreign currency exchange
rate to convert the value of the account
or asset into U.S. dollars, check the
“Yes” box on line 33 and go to line 34.
Otherwise, check the “No” box and go
to line 35.

DRAFT AS OF
November 5, 2021

If your search returns multiple
instances of the same name for the
financial institution, use the one that
most closely matches the information
that you have. You will not be subject to
penalties if you enter the wrong GIIN or
leave this field blank. Completing this
information may reduce the need for the
IRS to contact you.

Lines 27 and 28

Enter the mailing address of the
financial institution in which the account
is maintained.

Part VI. Detailed
Information for Each
"Other Foreign Asset"
Included in the Part II
Summary

Use Part VI to report information for
financial accounts (other than foreign
deposit and custodial accounts) and
other specified foreign financial assets
not held in a financial account. If you
have more than one asset, attach an
additional statement with the required
information for each additional asset
and check the box at the top of page 1
of the form.

Lines 29 Through 36

Enter the following information for each
financial account and specified foreign
financial asset not held in a financial
account reported in Part II. For
examples of specified foreign financial
assets not held in a financial account,
see Other Specified Foreign Financial
Assets, earlier.

Line 29

Enter a description of the account or
asset. If the asset is stock or securities,
include the class or issue of the stock or
securities.

Example 16. You own 100 shares of
XYZ Company, an Italian S.A. A
sufficient description is “100 Class A
shares of XYZ Company, S.A.”
Example 17. You own a bond
issued by AB GmbH, a German GmbH.
A sufficient description is “Bond of AB
GmbH, maturing on December 31,
2019.”

Line 32

Check the box for the value range that
represents the maximum value of the
account or asset during the tax year. If
the maximum value is more than
$200,000, enter the maximum value on
line 32e.
See Reporting Maximum Value,

TIP earlier, for information on

Line 34

If you answered “Yes” on line 33, enter
the following information.
1. The foreign currency in which the
account or asset is denominated.
2. The foreign currency exchange
rate used to convert the value of the
account or asset into U.S. dollars.
3. If the U.S. Treasury Bureau of the
Fiscal Service did not provide an
exchange rate, the source of the foreign
currency exchange rate that you used.
You must use the foreign
currency exchange rate on the
CAUTION last day of the tax year, even if
you closed the account or sold or
disposed of the asset before the last
day of the tax year.

!

Lines 35a Through 35e

If the account or asset you reported on
line 29 is stock of a foreign entity or an
interest in a foreign entity, complete
lines 35a through 35e.

determining the maximum value
of the account or asset.

Line 35a

Joint Interest in Other Foreign
Assets

Line 35b

Use the following rules to figure the
maximum value to report.

Spouses Filing a Joint Return
You and your spouse report the
maximum value of an account or asset
held jointly by you and your spouse only
once on the single Form 8938 filed with
your joint income tax return.

Spouses Filing Separate Returns
You and your spouse each report the
maximum value of an account or asset
held jointly by you and your spouse on
your separate Forms 8938 filed with
your separate income tax returns.

Other Joint Owners
Report the maximum value of the entire
jointly held account or asset on your
Form 8938 filed with your income tax
return, regardless of the value of your
-12-

Enter the name of the foreign entity.
If you have been furnished the GIIN
associated with the financial account or
asset listed on line 29, enter it here.
If you haven't been provided a GIIN
by your financial institution, you can look
it up by using the FATCA Foreign
Financial Institution (FFI) List Search
and Download tool. You can access the
tool at IRS.gov/Businesses/
Corporations/FATCA-Foreign-FinancialInstitution-List-Search-and-DownloadTool.
If your search returns multiple
instances of the same name for your
financial institution, use the one that
most closely matches the information
that you have. You will not be subject to
penalties if you enter the wrong GIIN or
leave this field blank. Completing this
information may reduce the need for the
IRS to contact you.

Instructions for Form 8938 (Rev. 11-2021)

Line 35c

Check the box on line 35c to indicate
the type of foreign entity.

Lines 35d and 35e

Enter the mailing address of the foreign
entity.

Lines 36a Through 36e

Lines 36d and 36e

Enter the mailing address of the issuer
or counterparty. If the issuer or
counterparty has a mailing address in
the United States, you can enter the
U.S. mailing address.

Paperwork Reduction Act Notice.
We ask for the information on this form
to carry out the Internal Revenue laws of
the United States. Section 6038D
requires specified individuals and
specified domestic entities to report
specified foreign financial assets in
which they have an interest. Form 8938
is used to comply with this reporting
requirement.

form is approved under OMB control
number 1545-0123. The estimated
burden for all other taxpayers who file
this form is shown below.
Learning about
the law or the
form . . . . . . . . . .
Preparing the
form . . . . . . . . . .
Copying,
assembling,
and sending the
form to the IRS . .

57 min.

DRAFT AS OF
November 5, 2021

If the account or asset you reported on
line 29 is not stock of a foreign entity or
an interest in a foreign entity, complete
lines 36a through 36e.

Note. If this account or asset has more
than one issuer or counterparty, copy
page 2 as many times as needed and
complete a separate line 36 for each
issuer or counterparty. Check the box at
the top of page 1 of the form.

Line 36a

Enter the name of the issuer or
counterparty and check the appropriate
box to indicate if you are reporting for an
issuer or a counterparty.

Line 36b

Check the appropriate box to indicate
the type of issuer or counterparty.

Line 36c

Check the box to indicate if the issuer or
counterparty is a U.S. person or a
foreign person.

Instructions for Form 8938 (Rev. 11-2021)

You are not required to provide the
information requested on a form that is
subject to the Paperwork Reduction Act
unless the form displays a valid OMB
control number. Books or records
relating to a form or its instructions must
be retained as long as their contents
may become material in the
administration of any Internal Revenue
law. Generally, tax returns and return
information are confidential, as required
by section 6103.

The time needed to complete and file
this form will vary depending on
individual circumstances. The estimated
burden for business taxpayers filing this

-13-

2 hr., 57 min.

48 min.

If you have comments concerning the
accuracy of these time estimates or
suggestions for making this form
simpler, we would be happy to hear
from you. See the instructions for the tax
return with which this form is filed.

Index
A
Additional Statements 10
Assets Not Required To Be
Reported 8

Exceptions To Reporting 8
Duplicative Reporting 8
Foreign Grantor Trusts 9

S
Special Rules 4
Specified Person 1
Excepted Specified
Domestic Entities 3
Passive Income 2
Specified Domestic
Entity 2
Specified Individual 1

Other Specified Foreign
Financial Assets 6

DRAFT AS OF
November 5, 2021

C
Closely Held Domestic
Corporation 2
Closely Held Domestic
Partnership 2
Constructive Ownership 2

D
Determining the Total Value
of Your Specified Foreign
Financial Assets 4
Asset With No Positive
Value 4
E
Excepted Specified
Domestic Entities 3

I
Interests in Specified Foreign
Financial Assets 6
P
Passive Income 2
Penalties 9
Accuracy-Related
Penalty 10
Criminal Penalties 10
Failure-To-File Penalty 9
Fraud 10

R
Reporting Maximum Value 7
Foreign Currency
Conversion 7
Reporting Period 7

T
Types of Reporting
Thresholds 3
Reporting Thresholds
Applying to Specified
Domestic Entities 4
Reporting Thresholds
Applying to Specified
Individuals 3
Types of Specified Foreign
Financial Assets 6
Financial Account 6
Foreign Financial
Institution 6

-14-

V
Valuing:
Valuing Financial
Accounts 8
Valuing Interests in
Foreign Estates,
Foreign Pension Plans,
and Foreign Deferred
Compensation Plans 8
Valuing Interests in
Foreign Trusts 8
Valuing Other Specified
Foreign Financial
Assets 8
W
When and How To File 1
Who Must File 1