IRS Form 8938 Instructions 2026: Statement of Specified Foreign Financial Assets Guide

IRS Form 8938 Instructions 2026 – Are you a U.S. citizen, resident alien, or certain domestic entity with foreign bank accounts, investments, or other overseas assets? You may need to file IRS Form 8938 with your tax return. This comprehensive guide provides official, step-by-step IRS Form 8938 instructions based on the latest continuous-use form (Rev. November 2021) and related IRS resources. Updated for tax year 2025 filings in 2026, it covers who must file, reporting thresholds, what assets to include, how to value and complete the form, penalties, and key differences from the FBAR.

Filing Form 8938 does not replace your FBAR (FinCEN Form 114) obligation. Many taxpayers must file both. Always verify details on the official IRS page at IRS.gov/Form8938, as the form and instructions are continuous-use and updated as needed.

What Is IRS Form 8938 and Why Is It Required?

Form 8938 reports your specified foreign financial assets when their total value exceeds the reporting threshold. It helps the IRS enforce FATCA compliance and combat offshore tax evasion.

You must attach it to your annual tax return (Form 1040, 1040-SR, 1040-NR, 1041, 1065, 1120, etc.) by the due date (including extensions). Do not file it separately.

Key reminder: Even if the assets generate no tax liability, you still report them if thresholds are met and you file a return.

Who Must File Form 8938?

You are a specified person required to file if:

  • You are a specified individual (U.S. citizen, resident alien, certain nonresident aliens electing resident status, or bona fide residents of American Samoa/Puerto Rico), or
  • You are a specified domestic entity (certain closely held domestic corporations, partnerships, or trusts formed/availed of to hold foreign assets).

Exceptions: No U.S. tax return required? No Form 8938 needed. Certain duplicated reporting (e.g., on Forms 3520, 5471) may exempt assets.

Specified domestic entities include closely held corporations/partnerships (≥80% ownership by a specified individual) where ≥50% of gross income or assets are passive, or domestic trusts with specified persons as beneficiaries. Excepted entities exist—check the instructions.

Form 8938 Reporting Thresholds (2025/2026)

Thresholds depend on your filing status and whether your tax home is in the U.S. or abroad. Use the maximum value during the tax year.

Specified Individuals Living in the United States:

  • Unmarried or Married Filing Separately: > $50,000 on the last day or > $75,000 at any time.
  • Married Filing Jointly: > $100,000 on the last day or > $150,000 at any time.

Specified Individuals Living Abroad (tax home outside U.S. + bona fide resident or 330-day presence test):

  • Unmarried or Married Filing Separately: > $200,000 on the last day or > $300,000 at any time.
  • Married Filing Jointly: > $400,000 on the last day or > $600,000 at any time.

Specified Domestic Entities: > $50,000 on the last day or > $75,000 at any time (no “living abroad” distinction).

Pro tip: “Living abroad” requires meeting the presence or bona fide resident test. Use the IRS comparison chart for quick reference.

What Assets Must Be Reported on Form 8938?

Report specified foreign financial assets only if they meet the definition and thresholds.

1. Financial Accounts maintained by a foreign financial institution (deposit, custodial, brokerage, or certain equity/debt interests/cash-value insurance/annuities). Includes accounts at foreign branches of U.S. banks in some cases.

2. Other Specified Foreign Financial Assets (held for investment, not in a financial account):

  • Stock or securities issued by a non-U.S. person.
  • Interests in a foreign entity (e.g., foreign partnerships, hedge funds, private equity).
  • Financial instruments/contracts with a non-U.S. issuer or counterparty (e.g., notes, bonds, swaps, options, foreign pensions/deferred comp plans, foreign estates).

Assets NOT required (common examples):

  • Direct foreign real estate, precious metals, art, jewelry, cars, collectibles.
  • Foreign currency held directly.
  • U.S. mutual funds or accounts at U.S. branches/institutions.
  • Safe deposit boxes.
  • Assets already reported on duplicative forms (e.g., 5471, 8865).

Note: Report the account itself—not individual holdings inside it. Indirect interests through foreign entities may qualify.

How to Determine Value and Report Maximum Value?

  • Total value test: Aggregate all specified foreign financial assets.
  • Use maximum value during the tax year (fair market value in USD).
  • Financial accounts: Year-end statements or reliable records.
  • Other assets: Public prices, appraisals, or reasonable estimates (no formal third-party appraisal required).
  • Foreign trusts/estates/pensions: Fair market value or distributions if unknown.
  • Convert using year-end exchange rates (see Treasury Fiscal Data tool).

Special rules apply for assets with zero positive value or constructive ownership.

How to Fill Out IRS Form 8938?

  1. Top of Form: Enter name, TIN, tax year, and filer type (individual, partnership, etc.).
  2. Part I – Foreign Deposit and Custodial Accounts: List number, max value, and details for each (use additional statements if > space).
  3. Part II – Other Foreign Assets: Same for non-account assets.
  4. Part III: Summarize income/gains/losses/credits from these assets and where reported on your return.
  5. Part IV: Note duplicative forms filed (3520, 5471, etc.) to claim exceptions.
  6. Parts V & VI (on continuation sheets): Detailed asset information (issuer, max value, etc.).
  7. Check the box for additional statements and attach as needed.

Pro tip: Use the IRS form PDF and instructions for exact line-by-line guidance.

Penalties for Not Filing or Incorrect Filing

  • Failure-to-file: Up to $10,000 + $10,000 per 30 days (max $60,000).
  • Accuracy-related or fraud penalties.
  • Criminal penalties possible.

Amended returns can correct prior omissions.

Form 8938 vs. FBAR: Key Differences

Many confuse the two. Here’s a quick comparison:

Aspect Form 8938 FBAR (FinCEN 114)
Who files Specified individuals + domestic entities U.S. persons (broader)
Threshold $50K–$600K (varies) >$10,000 aggregate anytime
Assets Foreign accounts + certain non-account investments Foreign financial accounts only
Filing location With tax return Separate FinCEN e-file
Due date With tax return (extensions OK) April 15 (auto-extension Oct 15)
Penalties Civil up to $60K+ Higher (willful up to 50% of balance)

Both may be required—check the full IRS comparison chart.

Common FAQs on Form 8938

  • Foreign pensions: Reportable if thresholds met.
  • Stocks in foreign brokerage: Report the account (not individual stocks).
  • Real estate held via foreign LLC: Report the entity interest (value includes property).
  • No tax impact: Still file if thresholds exceeded.

Final Tips for 2026 Filings

  • Download the latest Form 8938 and instructions directly from IRS.gov.
  • Use currency converters and keep detailed records.
  • Consult a tax professional or international tax advisor, especially for complex entities or living abroad.
  • Foreign grantor trusts and certain pensions have special rules—review fully.

Stay compliant and avoid penalties by following these IRS Form 8938 instructions. For the most current details, visit IRS.gov/Form8938 or the official instructions PDF. If your situation involves specified domestic entities or living abroad, double-check thresholds carefully.

This guide is for informational purposes only and based on trusted IRS sources as of March 2026. Tax laws can change—always confirm with the IRS or a qualified advisor.