Foreign real estate is not a specified foreign financial asset required to be reported on Form 8938. For example, a personal residence or a rental property does not have to be reported.
Do I need to declare my overseas property?
Yes, you must report foreign properties on your U.S. tax return just like you would report any owned U.S. property. To do that, you first need to know what type of ownership you have because it affects what tax forms you must file.
What assets are reported on 8938?
To get into the nitty gritty of it, if you’re a U.S. taxpayer who lives outside of the U.S. and holds a total combined value of foreign assets worth more than $300,000 at any time during the year (or $200,000 on the last day of the year) you need to report it on Form 8938.
Do I have to report sale of foreign property to IRS?
Generally speaking, the purchase of property–foreign or domestic–does not need to be reported on your US expat taxes (unless there is a Homebuyer’s Credit in place for the related year). When a property is sold, however, the resulting gain or loss will need to be reported on Schedule D of the taxpayer’s US expat taxes.
What gets reported on Form 8938?
Form 8938 reporting applies for specified foreign financial assets in which the taxpayer has an interest in taxable years starting after March 18, 2010. For most individual taxpayers, this means they will start filing Form 8938 with their 2011 income tax return.
What is the difference between FBAR and Form 8938?
FBAR, is that the Form 8938 is only filed when a person meets the threshold for filing AND has to file a tax return. So, if a person does not have to file a tax return (because for example, they are below the threshold) than the 8938 is not required in the current year either.
What is considered foreign property?
What’s considered specified foreign property? According to the Canada Revenue Agency (CRA), specified foreign property includes: Bank accounts held abroad (interest) Debt securities and shares of foreign corporations (mutual funds, shares, bonds, or debentures) and debt owed by a non-resident, including governments.
Can I deduct foreign property taxes?
Yes. If you itemize your deductions as an American living overseas, you can deduct foreign real estate taxes imposed by you by a foreign country. Unfortunately, you cannot take deduction for personal property taxes unless these taxes are incurred in a trade or business or in the production of income.
Can I depreciate foreign rental property?
Depreciation of residential rental property
If you own a foreign residential rental property, the property is depreciated over a 30-year period.
Do I need to report foreign interest income?
If you are a U.S. citizen or resident alien, you must report income from sources outside the United States (foreign income) on your tax return unless it is exempt by U.S. law. … If you reside outside the United States, you may be able to exclude part or your entire foreign source earned income.
Can I file Form 8938 electronically?
You can fill out a physical copy of Form 8938 and mail it with the rest of your tax return and tax payment by the annual federal tax filing deadline. You can also e-file Form 8938 with the rest of your electronic tax return.
What is the penalty for failure to disclose income on Form 8938?
Information return penalties: Where a taxpayer must file a Form 8938, disclosing his or her interest in “specified foreign financial assets,” fails to do so for any tax year, the taxpayer is subject to a penalty of $10,000.
How can I avoid capital gains tax on foreign property?
Main Residence Relief for Foreign Holiday Homes
The foreign property must be your own holiday home for at least part of the time but, by making the election, you will be able to exempt some or all of the capital gain on your foreign home from UK Capital Gains Tax.
Do I have to pay tax on property sold overseas?
When you sell property or real estate in the U.S. you need to report it and you may end up owing a capital gains tax. The same is true if sell overseas property. The U.S. is one of only a few countries that taxes you on worldwide income — and gains made from foreign property sales are considered foreign income.
How do I report foreign property on tax return?
IF you own your foreign real estate directly as an individual, there is good news. You do not have to report that property on Form 8938 or other FATCA forms even if it is a rental property. Any real estate taxes you pay on that property may be deducted on your itemized deduction schedule on your Form 1040.
Do foreign pensions need to be reported on FBAR?
Is Foreign Pension FBAR Reportable: Yes. In an nutshell, the Foreign Pension Plans are Reportable on the FBAR. The FBAR is Foreign Bank and Financial Account Form (FinCEN Form 114).