[FormerTint]

T looks like I have to fix Form 8938 (foreign assets) for 2012. It seems like every account held at an institution needs to be reported separately. I have a number of small (sometimes 0) accounts.

1) Can all the accounts held at one institution be aggregated together to produce just one entry in Part 1 of the form ? Otherwise it would be incredibly tedious to produce multiple entries for these very small accounts. I could put all the identifying numbers that will fit in the area that asks for identifying number

2) I also own several physical shares of a foreign company group subsidiaries. Total dividend is less than $10/year. Can I just aggregate all the dividends from these subsidiaries into 1 entry in Part II of Form 8938 ?
2) Part III of form 8938 asks for referral back to the actual line number where income is entered. This means that for every account, we need a link back to the actual line number in say Schedule B ? Will standard tax software like Turbo Tax handle this properly ? And what does line number mean, anyway ? For interest, Schedule B line 1, for dividends, Schedule B line 5, right ?

I thought the FBAR form was bad, but this is worse! The only saving grace is that since the form is no new, as long as you report the income properly, the IRS will hopefully not penalize you.

[AtlantaTaxExpert]

The Form 8938 is NOT used to report dividends or interest; it is used to report BALANCES of the various accounts you have.

Do not forget to submit the FBAR as well.

[FormerTint]

ATE, thanks, but that is not correct. Part III of the form asks for interest income, dividend income etc. for foreign assets. So unlike the FBAR, the income also needs to be reported here.

[AtlantaTaxExpert]

You are correct, but that information was already reported in other parts of the tax return. The Form 8938's PRIMARY purpose is to report the existence of foreign accounts and the balances of those accounts, similar to the FBAR.

It is my hope that eventually the Form 8938 will REPLACE the FBAR, because it has more realistic reporting thresholds.

[FormerTint]

I have another question -- it says clearly in the 8938 instructions that an account with a foreign branch of a US institution does not have to be reported. So I have a foreign account with Bank of America or Citi or Chase in a foreign country (they send 1099-INTs), it does not have to be reported on the 8938. But is it part of the balance that is counted towards the asset limit ?

So if I have 30 K with a foreign bank and 25 K with a foreign branch of Chase (single US resident), do I have to fill form 8938 at all ? [ The total balance > 50K, but the balance actually to be reported < 50K]. This may seem like hair splitting, but with a 10K penalty, one can't be too careful.

[AtlantaTaxExpert]

Are you getting a Form 1099-INT from Citibank to report the interest in the Citibank foreign.

If yes, you do not have to report the account on Form 8938.

If no, you do.

[FormerTint]

ATE

I am getting a 1099-INT. I know I don't have to report foreign branch of US bank. My question was somewhat different. Do I have to fill a form 8938 at all if my total balance EXCLUDING foreign branch of US bank is < 50K ? In the example I mention, my total assets abroad are 50K plus, but if I exclude foreign Chase branch, they are less than 50K.

[AtlantaTaxExpert]

Then, In my opinion, you exclude the CitiBank account completely from the equation, resulting in no Form 8938 requirement at all.

[AtlantaTaxExpert]

However, a phone call to the IRS International Tax Helpline may be in order to confirm this.