Coming in 2010 is Form 8938, Statement of Foreign Financial Assets. The draft of the form, which the IRS is soliciting public comment on, is now available. It may remind you of Form TD F 90-22.1 (FBAR).
Phil Hodgen (who alerted me to this form) notes, “What this means to you: Lots more work. Higher risks for screwing up your paperwork.” Yes, and the form appears more inclusive. The FBAR just asks for the financial assets. The way the Form 8938 reads that if you or a client owns 100 shares of a publicly traded foreign stock (say 100 shares of British Petroleum), you’d have to note it on the form. Perhaps I’m overreading the draft of the form (I haven’t seen instructions), but who knows.
I am likely to submit a comment to the IRS: Just have the FBAR submitted with the tax return, and be done with it. Unfortunately, I suspect that Congress meddled somewhere and is forcing this duplication of efforts. Adding this to the new mandatory $5,000 fine for even inadvertently not filing the FBAR makes foreign accounts far nastier in 2011 (that is, reporting 2010 foreign accounts).
Tags: FBAR