Form 8938 Foreign Financial Assets Checklist – 2022
Tax Year
Overview of Form 8938 for the 2022 Tax Year
U.S. citizens and resident aliens use Form 8938 to report specified foreign financial assets when the total value exceeds applicable reporting thresholds. These thresholds depend on filing status and whether you lived in the United States or outside the United States during the tax year.
For the 2022 tax year, married taxpayers filing jointly and living outside the United States are subject to higher thresholds than those living in the United States. Accurate threshold determination, asset identification, and valuation are essential for proper compliance.
Purpose and Scope of This Checklist
This checklist provides a structured reference for determining whether Form 8938 is required and for completing the form accurately for the 2022 tax year. It addresses filing status and residency determinations, asset identification, valuation rules, reporting structure, and documentation requirements.
Each step reflects the 2022 Form 8938 instructions and applies only to the rules in effect for that tax year. The checklist supports consistent reporting and proper recordkeeping.
Filing Checklist for Form 8938 (2022)
Step 1: Confirm Filing Status and Residency for 2022
Confirm your filing status for the 2022 tax year and determine whether you lived in the United
States or outside the United States. Filing status affects the applicable reporting thresholds, and married filing jointly taxpayers are subject to higher thresholds than single, head-of-household, or married filing separately taxpayers.
Residency status depends on whether you meet the applicable presence-abroad test. This determination governs which threshold amounts apply when evaluating your reporting obligation.
Step 2: Identify All Specified Foreign Financial Assets
Identify all specified foreign financial assets held at any point during 2022. These assets include foreign financial accounts maintained by foreign financial institutions and other specified foreign financial assets held for investment.
Other specified foreign financial assets may include certain foreign stocks or securities, interests in foreign entities, and certain foreign financial instruments or contracts that are not held in a financial account. Assets held during any part of the year must be evaluated.
Step 3: Determine the Maximum Value of Each Asset
Determine the maximum value of each specified foreign financial asset during the 2022 tax year. The reported value is generally the asset's fair market value at its highest point during the year.
For financial accounts, periodic account statements may be used to determine the maximum value if they provide a reasonable estimate. If you know or have reason to believe that the statements do not reflect a reasonable estimate, you must use an alternative valuation method.
Step 4: Compare Total Asset Value to the Applicable Threshold
Add together the maximum values of all specified foreign financial assets and compare the total to the applicable threshold for your filing status and residency.
For taxpayers living outside the United States who meet the presence-abroad test, unmarried taxpayers use a threshold of more than $200,000 on the last day of the year or more than
$300,000 at any time, and married taxpayers filing jointly use more than $400,000 on the last day or more than $600,000 at any time. Married filing separately taxpayers spend more than
$200,000 on the last day or more than $300,000 at any time.
For taxpayers living in the United States, unmarried taxpayers spend more than $50,000 on the last day or more than $75,000 at any time, and married taxpayers filing jointly spend more than
$100,000 on the last day or more than $150,000 at any time. Married filing separately taxpayers spend more than $50,000 on the last day or more than $75,000 at any time.
Step 5: Determine Bona Fide Residence in a U.S. Possession
Determine whether you were a bona fide resident of a U.S. possession during 2022. Bona fide residents of U.S. possessions are subject to special rules regarding which assets are included when calculating total specified foreign financial assets.
Certain assets may be excluded from the reporting calculation under these rules. Apply the possession-specific rules carefully when determining whether the reporting threshold has been met.
Step 6: Apply the Correct Foreign Currency Exchange Rate
Convert non-U.S. dollar asset values into U.S. dollars using the appropriate exchange rate. In most cases, the exchange rate used must be the U.S. Treasury Bureau of the Fiscal Service rate for purchasing U.S. dollars.
Another publicly accessible exchange rate may be used to buy US dollars if a Treasury rate isn't available. When an alternative rate is used, it must be disclosed on Form 8938.
Step 7: Identify Country or Jurisdiction Codes
Identify the country or jurisdiction associated with each specified foreign financial asset. This information reflects the location of the financial institution or the jurisdiction relevant to the asset.
Accurate jurisdiction reporting is required for each account or asset listed on Form 8938. Ensure consistency with the form instructions when selecting country information.
Step 8: Assemble Supporting Documentation
Gather documentation that supports ownership, valuation, and reporting details for each specified foreign financial asset. Records may include periodic account statements, contracts, ownership records, and other available documentation.
Maintain records sufficient to substantiate maximum values, asset classifications, and identifying information reported on the form. These records support accuracy and compliance.
Step 9: Complete Part I of Form 8938
Complete Part I with identifying information and threshold-related determinations. This section establishes whether the reporting thresholds have been exceeded and provides filer identification. Ensure all information in Part I reflects the correct filing status, residency determination, and threshold evaluation for 2022.
Step 10: Complete Parts II Through IV Based on Asset Type
Complete Parts II through IV depending on the category of assets being reported. Part II is used to report certain foreign financial accounts. Parts III and IV are used to report other specified foreign financial assets, depending on how the assets are held and classified. Complete only the sections applicable to the assets identified.
Step 11: Report Maximum Asset Values for 2022
Report the maximum value of each specified foreign financial asset during the 2022 tax year.
Reasonable estimates are permitted when supported by available information. Retain
documentation showing how each maximum value was determined. Consistent valuation methods should be applied across all reported assets.
- Full IRS transcript retrieval (Wage & Income + Account)
- Professional tax form review
- Preparation & filing support
- Tax relief options if you owe the IRS
Step 12: Provide Jurisdiction and Identifying Details
Include all required identifying details for each asset, including jurisdiction information, account numbers when applicable, and asset descriptions. Ensure the reported details match the documentation retained. Complete and accurate disclosures reduce the risk of reporting errors.
2022-Specific Thresholds and Compliance
Considerations
Reporting thresholds for IRS Form 8938 vary based on filing status and residency. For the 2022 tax year, U.S. taxpayers living outside the United States are subject to different limits than those filing an income tax return domestically. Married taxpayers filing jointly and residing abroad face the highest reporting thresholds for foreign assets, including foreign accounts, investment accounts, and certain interests in a foreign trust.
All financial assets reported on IRS Form 8938 must reflect their highest value at any point during the tax year. Foreign currency amounts are generally converted using the exchange rate in effect on the last day of the year. Failure to file an annual return or report required foreign assets may result in penalties, beginning with an initial assessment and increasing for continued noncompliance. Careful review of Internal Revenue Service requirements helps ensure accurate reporting and reduces the need for amended returns or corrective action with tax professionals.
If you’re missing tax documents or want to ensure the numbers you enter match IRS records, we can help.
