Federal law requires U.S. citizens and resident aliens to report any worldwide income, including income from foreign trusts and foreign bank and securities accounts. In many cases, affected taxpayers will need to complete and attach Schedule B to their individual tax return. Part III of Sch. B asks about the existence of foreign accounts, such as bank and securities accounts, and usually requires U.S. citizens to report the country in which each account is located. Certain taxpayers may also have to complete and attach Form 8938, Statement of Foreign Financial Assets, to their individual tax return filing.
Separately, taxpayers with foreign accounts whose aggregate value exceeded $10,000 at any time during 2012 must file Treasury Department Form TD F 90-22.1. Unlike many filings that are considered timely when filed, this form must be received on or before June 30, 2013 to be timely filed.
The penalties for failure to comply with the foreign income and asset reporting requirements are quite onerous. For those individuals who had foreign asset reporting requirements in earlier years and did not file the necessary forms, it is imperative that they contact an experienced tax attorney immediately.
Note: Because each individual has unique factors needs that need to be examined when determining that individual’s tax situation, we invite you to call 610-594-2601 today to make an appointment to discuss your personal situation.
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