FBAR, Form 8938, 3520 and 5471, and how to catch up — for families with accounts, assets, gifts or companies abroad.
12 articles
Missed Form 3520 for foreign gifts over $100,000? The penalty can be 5% of the gift per month, up to 25%, but since October 2024 the IRS reviews the attached reasonable cause statement before assessing. How to choose between DIIRSP, SFOP and SDOP.
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Three separate rules: the 1% remittance tax (cash and money orders only; §4475 regulations still proposed, not final as of October 21, 2026), the $19,000 per-recipient gift exclusion and Form 709, and Form 3520 for gifts over $100,000 you receive. A PERM suspension does not change your tax residency.
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Missed reporting foreign income or FBARs, and it was non-willful? Compare the IRS Streamlined Foreign Offshore (SFOP) and Streamlined Domestic Offshore (SDOP) procedures: the non-residency test, 3 years of returns, 6 years of FBARs, Forms 14653/14654, the SDOP 5% penalty base, and who should not use streamlined.
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On July 1, 2026, IRS removed its Delinquent FBAR Submission Procedures page—no formal announcement. With the Oct 15, 2026 automatic FBAR extension for 2025 accounts approaching, Cary/RTP clients with China/foreign accounts should plan compliance carefully.
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DIIRSP describes normal-procedure filing of delinquent international information returns when not under exam/contact—not a penalty amnesty. IRS may still assess penalties; reasonable-cause letters may be ignored at first. Compliance planning only.
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U.S. persons receiving >$100k of gifts from NRA relatives generally file Form 3520 Part IV (lower thresholds for foreign entity “gifts”). Reporting ≠ automatic wage income, but non-filing has penalties. Cary/RTP family compliance notes.
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A China “JV” may be a corporation, partnership, or disregarded entity for U.S. tax. Foreign partnerships can require Form 8865 (control/10%/contribution/change categories); Cat 1/2 penalties often start at $10k/year. Classify first.
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U.S. persons with China company equity may need Form 5471. CFC and 10% U.S.-shareholder tests are common triggers; §6038 penalties often start at $10k per corp per year. Cary/RTP founder compliance notes.
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Form 8938 (FATCA) thresholds vary by U.S. vs abroad and single vs joint—e.g., U.S. single $50k/$75k, MFJ $100k/$150k; higher abroad. Filing 8938 ≠ FBAR. Cary/RTP compliance notes.
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U.S. persons with China accounts aggregating over $10k in 2025 must e-file an FBAR with FinCEN. The deadline auto-extends to Oct 15, 2026 (Thursday)—no separate request. About four weeks remain; plan compliance now.
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FBAR (FinCEN 114) and Form 8938 are parallel regimes—FinCEN vs IRS, $10k vs higher thresholds. Filing one does not replace the other. Cary/RTP clients with China accounts need dual-track compliance planning.
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OBBBA added §4475: a 1% excise tax on certain outbound remittances after Dec. 31, 2025. Cash/money-order/cashier’s-check funding is generally taxed; withdrawals from BSA-regulated accounts or U.S.-issued debit/credit cards are generally exempt. Check how you fund China remittances.
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Articles are general information, not tax or legal advice for your specific situation.
