Do I need to file 8621 every year?
Do I need to file 8621 every year?
If you are a direct or indirect shareholder of a PFIC, you are required to file IRS Form 8621 for each year that you: Recognize gain on a direct or indirect disposition of PFIC stock, or. Receive certain direct or indirect distributions from a PFIC, or. Make an election reportable on Form 8621.
Where do I file IRS form 8621?
If you are not required to file an income tax return or other return for the tax year, file Form 8621 directly with the Internal Revenue Service Center, Ogden, UT 84201-0201.
How do I report foreign mutual funds to the IRS?
In general, if you have shares in a foreign mutual fund, you’ll have to report it to the IRS. There are a few reporting requirements you may have: Form 8621, Return by a Shareholder of a Passive Foreign Investment Company or a Qualified Electing Fund. FBAR – Your Foreign Bank Account Report.
Can form 8621 be filed electronically?
You can file Form 8621 online with H&R Block’s Expat Tax Services. You may have to file more than one form—if you’re required to file Form 8621, you must file a form for each PFIC in which stock is held.
Who needs a PFIC statement?
Effective for 2013 and subsequent years, U.S. taxpayers holding investments in Canadian Funds (“U.S. Holders”) are required to file Form 8621 to report their investment in a PFIC. Please see below a link to the IRS Form 8621, “Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund.”
What is passive income for PFIC?
A passive foreign investment company (PFIC) is a corporation, located abroad, which exhibits either one of two conditions, based on either income or assets: At least 75% of the corporation’s gross income is “passive”—that is, derived investments or other sources not related to regular business operations.
How are foreign mutual funds taxed in the US?
Both distribution and dispositions from foreign mutual funds are taxed at higher rates than other types of investments. Foreign mutual funds must be reported every year on IRS Form 8621 if they receive a distribution or make a disposition from a PFIC.
What is the purpose of IRS form 8621?
What is IRS Form 8621 used for? Tax form 8621, Information Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund, is used to report income from foreign mutual funds, also referred to as passive foreign investment companies (PFICs).
What do you do with a PFIC statement?
When investing in a PFIC, each tax year, a PFIC statement must be filed with the IRS….Under the US tax laws, PFICs can be treated as:
- A Qualified Electing Fund (QEF).
- Mark to market.
- Tax and interest.
