Notice 2011-55: IRS Partially Suspends FATCA Information Reporting Requirements
The IRS announced today that information reporting requirements under new Code Sections 6038D and 1298(f) are suspended until the release of new Form 8938 and revised Form 8621. Notice 2011-55, which comes only one day after the IRS released its draft Form 8938, provides a short respite for U.S. taxpayers subject to the barrage of foreign asset reporting requirements.
FATCA Reporting Requirements
The suspended requirements were initially enacted in 2010 with the Foreign Account Tax Compliance Act (“FATCA”), which plays a revenue support role in the larger Hiring Incentives to Restore Employment Act (“HIRE”). Code Section 6038D mandates U.S. taxpayers with foreign financial assets valued over $50,000 to file new informational Form 8938 with their annual return. Code Section 1298(f) requires shareholders of a passive foreign investment company (“PFIC”) to file an annual information report, later deemed to be a revised Form 8621. Both requirements are effective for tax years beginning on or after March 18, 2010; the Treasury intends to release regulations clarifying each provision.
Interim Guidance: Notice 2011-55
Because individuals may be subject to reporting requirements under 6038D and 1298(f) before the appropriate forms are released, the IRS issued interim guidance in Notice 2011-55. Scheduled to be published on July 18 with Internal Revenue Bulletin 2011-29, Notice 2011-55 provides the following:
No FBAR Relief
Compliance with Code Sections 6038D and 1298(f) does not relieve a taxpayer of the obligation to file a Report of Foreign Bank and Financial Accounts (“FBAR”).
The attorneys at Fuerst Ittleman, PL have extensive experience with the complex regulatory provisions governing foreign asset reporting and PFICs. Contact an attorney by emailing us at email@example.com.