Form 8938 (2013) Tax Year Checklist
Purpose
Form 8938 requires U.S. citizens and residents to report specified foreign financial assets exceeding applicable thresholds. For 2013, filers must distinguish between assets reported on Forms 3520, 3520-A, 5471, 8621, 8865, or 8891 (excepted assets that do not need to be duplicated on Form 8938) and all other specified foreign financial assets that require full disclosure and valuation detail. This form is a key component of the Foreign Account Tax Compliance Act (FATCA) reporting requirements for U.S. taxpayers.
Steps
1.
Determine filing requirements by comparing aggregate maximum values of all specified foreign financial assets during 2013 against the applicable threshold (varies by filing status and residence). Confirm whether you were a U.S. citizen or resident alien on December 31, 2013, as only these U.S. persons must file Form 8938.
Filing thresholds range from $50,000 to $600,000 depending on your marital status, filing status, and whether you live abroad. U.S. Nonresident Alien Income Tax Return filers (Form 1040-NR) may also have filing obligations if they make certain elections. This determination is separate from the Report of Foreign Bank and Financial Accounts (FinCEN Form 114) requirements.
2.
Identify and list all foreign deposit accounts (checking, savings, money market accounts) maintained with foreign financial institutions. Enter the count and maximum value during 2013 in Part I, lines 1–2. Part I serves as a summary section for all foreign bank accounts reported in detail in Part V.
Note whether any accounts were opened or closed during the year. These foreign financial accounts must be reported regardless of whether they generated taxable income on your U.S. Individual Income Tax Return.
3.
Identify and list all foreign custodial accounts (held by a custodian or agent on your behalf). Enter the count and maximum value during 2013 in Part I, lines 3–4. Use the same year-end and peak-balance methodology as for deposit accounts.
Part I consolidates summary information for all custodial accounts, which will be detailed in Part V. This includes brokerage accounts and other custodial arrangements with foreign banks and Financial Accounts, which must be disclosed by U.S. persons regardless of their location.
4.
Review Part IV and check boxes for each form filed during 2013 that contains reported specified foreign financial assets (Forms 3520, 3520-A, 5471, 8621, 8865, and 8891). This accepted asset framework has been available since the introduction of Form 8938, allowing you to avoid duplicate reporting.
Do not include these assets again in Parts V or VI to avoid redundant disclosure. U.S. Individual Income Tax Return filers should complete this section carefully to ensure proper coordination with other international reporting forms required under U.S. tax code provisions.
5.
In Part III, match each asset category (foreign deposit/custodial accounts and other foreign assets) to corresponding tax items (interest, dividends, royalties, other income, gains/losses, deductions, and credits) reported on the 2013 tax return schedules. Cite the exact form and line where each item appears on Form 1040 or related schedules.
This cross-referencing ensures the IRS can trace income and deductions directly from foreign assets to your U.S. Individual Income Tax Return and verify compliance with U.S. tax code requirements. Both U.S. citizens and qualifying resident aliens must complete this section accurately.
6.
Complete Part V for each foreign deposit or custodial account not excepted under Part IV. Record account type, number/designation, dates of opening/closing if applicable during 2013, maximum value during 2013, and complete financial institution identification, including mailing address. If an account is jointly owned with your spouse, check box 3c.
Provide detailed information for every foreign bank account summarized in Part I unless it was already reported on an excepted form listed in Part IV. U.S. taxpayers with accounts in U.S. territories must also evaluate reporting requirements.
7.
Complete Part VI for each “other foreign asset” (stocks, bonds, real property interests, foreign partnerships, foreign trusts, foreign estates, etc.) not reported on excepted forms. Describe the asset, provide identification information, check acquisition or disposition dates if applicable during 2013, and select the maximum value range (or enter the exact amount if exceeding $200,000).
Part VI captures all specified foreign investments and foreign financial accounts held for investment that are not deposit or custodial accounts maintained by foreign financial institutions. All U.S. persons with interests in these assets must report them.
8.
For any asset reported in Part VI that is stock of or an interest in a foreign entity, including a foreign partnership, foreign trust, or foreign estate, complete lines 7a–7d with the entity name, type (partnership, corporation, trust, or estate), and mailing address. For assets that are not foreign entity interests, complete lines 8a–8e with issuer or counterparty name, type, U.S. or foreign person status, and address.
This information helps the IRS identify the source and nature of your foreign investments and ensure compliance with criminal penalties provisions for willful non-disclosure by U.S. citizens and other covered individuals.
9.
Convert all foreign currency values to U.S. dollars using the exchange rate applicable at the time of valuation. If you used a foreign currency exchange rate, answer “Yes” on line 5 (Parts V and VI) and identify the specific currency, the rate used, and the source.
In most cases, use the U.S. Treasury Financial Management Service rate available at www.fms.treas.gov/intn.html. If that rate is unavailable, use an alternative publicly available rate and disclose the source. Accurate currency conversion is essential for proper valuation of foreign financial accounts and ensures U.S. taxpayers report correct dollar amounts on their returns.
10.
Attach continuation statements to the form for each additional account (beyond the first) reported in Part V and each additional asset (beyond the first) reported in Part VI. Label each continuation statement with the form name, tax year, and sequential page number.
Check the box at the top of page 1, indicating that you have attached continuation statements, and enter the total number attached. This is particularly important for U.S. persons with multiple foreign bank accounts or diverse foreign investments across various jurisdictions.
11.
Verify that all maximum values are reported as of the highest balance reached during the 2013 tax year, not necessarily the December 31, 2013, year-end balance. Review Part III to ensure all income, gains, losses, deductions, or credits derived from listed assets are appropriately cross-referenced to U.S. Individual Income Tax Return schedules or forms on which they appear.
Maximum value reporting captures the peak value at any point during the year, which may exceed year-end balances and affects whether U.S. citizens and other filers meet reporting thresholds under the applicable U.S. tax code provisions.
12.
Attach Form 8938 to your 2013 Form 1040, 1040-NR (U.S. Nonresident Alien Income Tax Return), or other applicable return. Confirm that the form is signed and dated, and that all required information is complete before filing, as incomplete or missing foreign asset details may result in substantial criminal penalties under Section 6038D of the U.S. tax code.
The initial failure-to-file penalty is $10,000, with additional penalties of up to $50,000 for continued noncompliance after receiving an IRS notice. Willful violations may result in additional criminal penalties, including fines and imprisonment, for U.S. taxpayers who knowingly fail to report.
Year-Specific Guidance
● The 2013 Form 8938 continues the excepted asset framework (Part IV) that has been available since Form 8938 was first implemented, permitting filers to exclude from detailed reporting any specified foreign financial assets already reported on Forms 3520, 3520-A, 5471, 8621, 8865, or 8891 during the same tax year.
This framework reduces the compliance burden for U.S. taxpayers filing multiple foreign asset forms while maintaining the comprehensive disclosure of foreign investments and foreign partnerships required under the U.S. tax code.
● Part I (Foreign Deposit and Custodial Accounts Summary) and Part II (Other Foreign Assets Summary) are new additions to the 2013 form. These summary sections consolidate high-level information about the number and aggregate maximum values of assets, providing a foundation for detailed reporting in Parts V and VI. This organizational change streamlines completion for U.S. citizens and other U.S. individuals with multiple foreign bank accounts and foreign financial accounts.
● Part III of the 2013 form requires explicit cross-referencing of tax items attributable to specified foreign financial assets to the exact U.S. Individual Income Tax Return lines on which they are reported. This requirement ensures the IRS can trace income and deductions directly from foreign investments, foreign trusts, and foreign estates to verify proper tax treatment by all U.S. taxpayers subject to these reporting requirements.
● The maximum value ranges in Part VI for “other foreign assets” (lines 4a–4e) are fixed at $0–$50,000, $50,001–$100,000, $100,001–$150,000, $150,001–$200,000, and above $200,000 for 2013. U.S. individuals whose assets exceed $200,000 must enter the exact value, rather than selecting a range, to provide the IRS with precise valuation information.
● Foreign currency conversion methodology is required at line 5 (Parts V and VI) for 2013. All U.S. taxpayers must disclose the specific currency, the exchange rate applied, and its source to establish consistency with the Report of Foreign Bank and Financial Accounts records and IRS currency guidance under relevant U.S. tax laws.
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This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance.
