Foreign Account Tax Compliance Act (FATCA)
The Foreign Account Tax Compliance Act, more commonly known as FATCA, became law in March 2010, and is designed to make sure U.S. taxpayers with foreign accounts pay the taxes they owe.
Essentially, if you’re a U.S. taxpayer with foreign financial assets of more than a certain amount, you may be required to report them to the IRS.
FATCA and other requirements for international taxpayers are complex topics. After you review this page, you may want to discuss your situation with a tax professional or legal advisor.
FATCA generally requires the reporting of foreign financial assets, including some common ones:
And some less common ones:
The information reporting from FATCA comes from two sources:
Figure out if you need to report your assets, and report them to the IRS
U.S. citizens, U.S. individual residents, and a very limited number of U.S. nonresident individuals who own certain foreign financial accounts or other offshore assets must report those assets to the IRS if they exceed certain amounts.
The amount is different depending on if you live inside or outside the U.S., and if you are filing as single, married filing jointly, or married filing separately.
The specific amounts are listed in the Instructions for IRS Form 8938, Statement of Specified Financial Assets.
Penalties apply if you fail to file an accurate IRS Form 8938, Statement of Specified Financial Assets.
You don’t have to file IRS Form 8938 if you don’t have to file an income tax return for the tax year, regardless of the value of your specified foreign financial assets.
How to report your foreign assets to the IRS
Foreign assets are reported on IRS Form 8938, Statement of Specified Foreign Financial Assets.
Fill out the form and attach it to your tax return.
There are penalties if you must file IRS Form 8938, Statement of Specified Foreign Financial Assets, and don’t, or if you file it and it is incorrect.
Taxpayers with foreign financial accounts may have to report information under both FATCA and Bank Secrecy Act regulations (FBAR). Separate penalties may apply for failing to file each form.
Remember that FATCA isn’t just about you reporting your own assets. Foreign financial institutions may provide third-party information reporting about financial accounts to the IRS, including the identity and certain financial information associated with the account. Be sure your information matches what the institution sends.
The IRS office in Philadelphia, Pennsylvania provides international tax assistance. This office is open Monday through Friday from 6:00 a.m. to 11:00 p.m. EST (10:00 a.m. to 3:00 a.m. GMT):
Browse common tax issues and situations at Get Help.
If your IRS problem is causing you financial hardship, you’ve tried repeatedly and aren’t receiving a response from the IRS, or you feel your taxpayer rights are not being respected, consider contacting Taxpayer Advocate Service (TAS).
You may be eligible for representation from an attorney, certified public accountant (CPA), or enrolled agent (EA) associated with a Low Income Taxpayer Clinic (LITC). LITCs may also provide information about taxpayer rights and responsibilities in different languages for individuals who speak English as a second language.