Form 8938: Foreign Asset Reporting Decision Guide

Start with taxpayer status, residence, and assets

What Form 8938 is and where it is filed

Form 8938 is an IRS form used to report “specified foreign financial assets” when a “specified individual” meets an applicable reporting threshold. At a high level, the form is informational: it summarizes the types of foreign financial assets you hold and their values. Importantly, Form 8938 is attached to your annual federal income tax return; it is not filed on its own. You can find the IRS’s overview at About Form 8938, and the detailed directions in the Instructions for Form 8938. These official pages outline who is a specified person, what counts as a specified foreign financial asset, and how the reporting thresholds work. See: IRS About Form 8938 and IRS Instructions for Form 8938.

If your question today is simply, “Do I have a Form 8938 issue?” a practical way to begin is to inventory your non‑U.S. financial footprint and compare it to the IRS thresholds for your filing status and residence. For individuals living in the United States, the threshold for an unmarried filer (or married filing separately) starts at more than $50,000 on the last day of the tax year or more than $75,000 at any time during the year. For a married couple filing jointly in the United States, the threshold is more than $100,000 on the last day of the tax year or more than $150,000 at any time during the year. For individuals living abroad (as defined in the instructions), the thresholds are higher, as outlined later in this guide. See: IRS comparison of Form 8938 and FBAR requirements.

Form 8938 often comes up alongside FBAR (the Report of Foreign Bank and Financial Accounts). These are different frameworks with different thresholds and different filing mechanics. Form 8938 does not replace the FBAR, and some people review both. The IRS provides a side‑by‑side comparison to help you see the distinctions, including how and where each report is filed. See: IRS comparison of Form 8938 and FBAR requirements.

A few additional orientation points may help you frame the right next questions:

• Form 8938 focuses on “specified foreign financial assets,” which can include financial accounts maintained by foreign financial institutions and certain financial interests held outside an account. The instructions provide the definitions and examples.
• Directly held foreign real estate is generally not reported on Form 8938. However, an interest in a foreign entity that owns real estate may itself be a specified foreign financial asset. See the instructions for details.
• Thresholds depend on filing status and whether you are considered to live in the United States or abroad (as defined in the instructions).
• Values are considered both at year‑end and at any time during the year.

Because the definitions and thresholds have important nuances, it may help to keep the official instruction page open as you read. This guide aims to point you toward the specific questions you can answer with your documents and the current IRS instructions, so you can decide whether you may need to attach Form 8938 to your federal return.

Useful next links:

• IRS — About Form 8938
• IRS — Instructions for Form 8938
• IRS — Comparison of Form 8938 and FBAR requirements
• Our FBAR hub for high‑level context: FBAR guide
• Need a human review of your facts? Consider /book-tax-session/

Form 8938 threshold framework

Who should investigate Form 8938

Anyone who is a U.S. person with a non‑U.S. financial footprint may want to investigate whether Form 8938 is part of their annual filing picture. The IRS refers to “specified individuals” and “specified domestic entities” in the instructions. Whether you are a specified person depends on how the IRS defines those terms, which you can review directly in the Instructions for Form 8938. This guide focuses on the decision process for individuals because the IRS comparison materials outline the individual thresholds most people ask about first.

As a practical matter, you may have a Form 8938 question if one or more of these statements describes your situation:

• You maintain one or more financial accounts that are located outside the United States (for example, a current account, savings account, or investment account held with a foreign financial institution).
• You hold financial assets outside an account, such as an interest in a foreign entity or certain financial instruments with a non‑U.S. issuer or counterparty, as discussed in the Instructions for Form 8938.
• You relocated abroad or split the year between the United States and another country and now hold assets in more than one jurisdiction.
• You previously focused on FBAR only and are now learning that FBAR and Form 8938 cover overlapping but not identical categories and thresholds.

Because the rules apply based on your filing status and whether you are considered to live in the United States or abroad, the same asset mix can lead to different conclusions for different people. For instance, an unmarried person residing in the United States sees a lower threshold than a similarly situated individual who is considered to live abroad (as defined in the instructions). The Instructions for Form 8938 explain how to determine whether you are treated as living abroad for threshold purposes.

Here is a simple way to self‑organize your review before you read the instructions:

• Step 1: List every non‑U.S. financial account you control or have an interest in. Capture the highest balance during the year and the year‑end balance, in local currency.
• Step 2: List every non‑account financial interest that may fall within the instruction categories (for example, an ownership interest in a foreign entity). Note the nature of the interest and any available statements.
• Step 3: Note your filing status (single, married filing jointly, married filing separately) and whether you believe you may be considered to live abroad under the instruction definitions.
• Step 4: Convert local amounts to U.S. dollars in a consistent manner after reviewing the currency‑conversion guidance in the Instructions for Form 8938.

With these lists, you can read the “Who Must File” and “Specified Foreign Financial Assets” sections of the Instructions for Form 8938 and compare your totals to the IRS thresholds. If you find you also have foreign financial accounts, it can be helpful to read the IRS’s comparison of Form 8938 and FBAR side by side. The comparison explains that Form 8938 is attached to your income tax return, whereas the FBAR is a separate filing and may have different thresholds and scope.

If you prefer a conversation to confirm your understanding, you can schedule a focused session to walk through your facts and the current IRS materials at /book-tax-session/.

Specified foreign financial assets and common distinctions

Thresholds by filing status and residence

Form 8938 uses asset‑value thresholds that vary by filing status and by whether you are considered to live in the United States or abroad. To decide whether Form 8938 may be part of your filing, you compare the total value of your specified foreign financial assets to the relevant thresholds at two points in time: on the last day of the tax year and at any time during the tax year.

For individuals living in the United States:

• Unmarried individuals or married individuals filing separately: more than $50,000 on the last day of the tax year or more than $75,000 at any time during the tax year.
• Married individuals filing jointly: more than $100,000 on the last day of the tax year or more than $150,000 at any time during the tax year.

For specified individuals living abroad (as defined in the instructions):

• Unmarried individuals or married individuals filing separately: more than $200,000 on the last day of the tax year or more than $300,000 at any time during the tax year.
• Married individuals filing jointly: more than $400,000 on the last day of the tax year or more than $600,000 at any time during the tax year.

These values are drawn from the IRS’s published comparison of Form 8938 and FBAR requirements. The Instructions for Form 8938 also explain the living‑abroad concept that applies to individuals for purposes of these thresholds. If you think your facts might fit the living‑abroad definition, it is worth reading that part carefully because residence status here is a term of art for threshold purposes. See: IRS comparison of Form 8938 and FBAR requirements; IRS Instructions for Form 8938.

A few practical points as you apply the thresholds:

• The thresholds look at your total specified foreign financial assets, not one account or asset in isolation. The instructions explain aggregation and valuation considerations.
• There are two tests: a year‑end test and an “any time during the year” test. Exceeding either can create a Form 8938 reporting question, depending on your other facts.
• Filing status matters. If you are married, whether you file jointly or separately can change which threshold applies, so consider that early in your review.
• If your residence changed during the year, the instructions will guide you on how to evaluate which threshold applies. This may depend on whether you meet the instruction definition of living abroad.

A visual way to think about it:

• Identify your filing status for the year.
• Determine whether you are considered to live in the United States or abroad (per the instructions).
• Sum the value of your specified foreign financial assets.
• Compare the total to the applicable year‑end threshold and the “any time” threshold for your category.

If your totals may be near a threshold, it can be helpful to prepare your figures in U.S. dollars using the currency guidance in the Instructions for Form 8938, then revisit the threshold comparison. Because the definitions and measurements can be nuanced, consider bookmarking the IRS instruction page and reviewing it as you work through your numbers.

Assets that can be misunderstood or treated differently

Specified foreign financial assets, and assets often misunderstood or excluded

Understanding what counts as a “specified foreign financial asset” is central to Form 8938. The IRS Instructions for Form 8938 define the term and give examples, which generally fall into two broad groups:

• Financial accounts maintained by foreign financial institutions.
• Certain foreign financial assets held for investment that are not held in an account, such as interests in foreign entities, stock or securities issued by non‑U.S. persons, and certain financial instruments or contracts with a non‑U.S. issuer or counterparty.

Because the exact categories and exceptions matter, it is wise to read the “Specified Foreign Financial Assets” section of the Instructions for Form 8938 and map those definitions to your own holdings. If you have a complicated investment structure, a tailored review may be helpful to interpret how the instructions apply to each piece.

Assets often misunderstood or excluded Some items create frequent confusion. These highlights can help you frame the right questions as you review the instructions:

• Directly held foreign real estate: Generally not reported on Form 8938. However, an interest in a foreign entity that owns real estate may be a specified foreign financial asset. This distinction—asset vs. entity interest—is emphasized in the IRS materials.
• Cash value inside a foreign financial account: The account itself may be a specified foreign financial asset. Whether sub‑assets or sub‑accounts within it require separate entries is addressed in the instructions.
• Interests held through a U.S. financial institution: The instructions distinguish between assets maintained by foreign financial institutions and those held with U.S. institutions. The place of custody and the nature of the asset both matter.
• Beneficial interests and joint accounts: Control and ownership interests may be relevant. The instructions discuss when a person is considered to have an interest in an account or asset.
• Retirement or pension‑type arrangements outside the United States: The instructions discuss how to analyze interests in foreign entities and contracts. Because arrangements vary by country, the form and the instructions, not labels, guide the analysis.
• Assets already reported on other forms: Reporting on another IRS form does not necessarily replace Form 8938 unless the instructions say so. The instructions explain coordination rules.
• Currency and precious metals held directly: Treatment can depend on how and where they are held. The instructions discuss what counts as a foreign financial asset.

Practical classification steps

• Make a complete list of non‑U.S. financial accounts, then read the instruction definition of a “financial account maintained by a foreign financial institution.” Check each item against the definition.
• Make a separate list of financial interests that are not held in accounts, then read the instruction list of other foreign financial assets held for investment. Check each item against the list.
• Note any interests in foreign entities. The instructions discuss ownership interests and when those may be specified foreign financial assets.
• Flag anything that looks like directly held real property; apply the instruction note that directly held foreign real estate is generally not reported, but an entity interest that owns such property may be.

It bears repeating that Form 8938 focuses on financial accounts and certain financial interests. If you find yourself thinking “this is property, not a financial account,” that is your cue to open the instructions and look for how the IRS distinguishes between a financial asset, an entity interest, and directly held property. See: IRS Instructions for Form 8938.

Value, currency, and record-gathering steps

Valuation, currency, and record gathering

Once you have listed potential specified foreign financial assets, the next step is to measure them the way the IRS asks you to measure them. The Instructions for Form 8938 explain how to determine value for purposes of the year‑end test and the “any time during the year” test, how to treat jointly held assets, and how to convert local currency amounts to U.S. dollars. Reviewing these sections with your documents in hand can make the process more straightforward.

A practical approach to valuation

• Identify the relevant valuation date(s): You will generally need the maximum value during the year and the value on the last day of the tax year for each asset. The instructions explain how to determine the maximum value for accounts and other assets.
• Use available statements and confirmations: Bank and brokerage statements, custodian reports, and year‑end summaries can help document both the maximum and year‑end values. If statements are not in English, ensure you can explain the figures you used.
• Consider ownership shares: If you do not own 100% of an asset, read the instructions on reporting your interest. How you determine your share may depend on the type of asset and ownership arrangement.
• Consistent currency conversion: The instructions discuss converting amounts to U.S. dollars. Pick a reasonable, instruction‑consistent approach and apply it consistently across assets. Note what you used so your work is reproducible.
• Keep a calculation log: As you compute year‑end and “any time” totals, a simple worksheet listing the source document, date, local amount, exchange method, and U.S. dollar result can be invaluable.

Documents and data to gather before you start

• For each foreign financial account: institution name and address, account number, account type, monthly or quarterly statements, and any year‑end summary. Note the highest balance shown during the year and the balance on the last day of the year.
• For non‑account assets (per the instructions): contracts, issuer or counterparty details, interest or ownership certificates, capitalization tables, or any documents from the foreign entity that describe your interest and its value.
• For jointly held assets: documents showing the co‑owners and any agreement or local law excerpt that clarifies ownership shares, if available.
• Identity and status: your filing status for the tax year and whether you may be considered to live abroad under the instruction definitions (review the Instructions for Form 8938 for how this is determined).
• A currency‑conversion note: a short memo to yourself citing the instruction guidance you are following for exchange rates and the dates you applied.

Sanity‑check your totals

• First pass: Convert each asset’s year‑end value to U.S. dollars. Sum across all specified foreign financial assets and compare to the year‑end threshold for your filing status and residence category.
• Second pass: Identify each asset’s maximum value at any time during the year, convert to U.S. dollars, and sum. Compare to the “any time during the year” threshold for your category.
• Tie‑outs: If either total is close to a threshold, re‑read the instruction sections on valuation and aggregation to make sure your approach matches the IRS’s method.

If you are working through these steps and realize you also hold foreign bank or financial accounts, consider reading the IRS’s comparison of Form 8938 and FBAR alongside your notes. The two frameworks have different scopes and different filing mechanics, and the IRS comparison page can help you see whether an FBAR review is also appropriate. See: IRS comparison of Form 8938 and FBAR requirements. For broader context on U.S. persons abroad, the IRS’s Publication 54 can help you understand how worldwide income reporting fits into your overall picture. See: IRS Publication 54.

If you would like a second set of eyes on your asset list, valuation approach, and instruction citations, you can book a tailored conversation at /book-tax-session/.

Form 8938 and FBAR: why both questions may arise

Form 8938 compared with FBAR, plus a decision path and when a tailored review is appropriate

Form 8938 and FBAR often come up in the same conversation, but they are not the same. The IRS emphasizes that Form 8938 does not replace the FBAR and that some people review both. A few key contrasts from the IRS’s comparison page:

• Where filed: Form 8938 is attached to your annual federal income tax return; FBAR is a separate filing, submitted electronically to the Financial Crimes Enforcement Network (FinCEN), not attached to your tax return.
• Scope: Form 8938 covers “specified foreign financial assets,” which include financial accounts maintained by foreign financial institutions and certain other foreign financial assets held for investment that are not in an account. FBAR focuses on foreign financial accounts meeting its own definitions.
• Thresholds: Form 8938 thresholds vary by filing status and whether you are considered to live in the United States or abroad; FBAR has different thresholds and aggregation rules. The IRS comparison page explains the differences at a glance. See: IRS comparison of Form 8938 and FBAR requirements.

A precise, visual decision path you can run with your documents

• Step A: Do you have any financial accounts outside the United States?
• If yes, open the IRS comparison page and our FBAR overview at FBAR guide. Note that FBAR is a separate filing from your tax return. Keep going to Step B for Form 8938 as well.
• If no, proceed to Step B for Form 8938 because non‑account foreign financial assets can still be relevant.
• Step B: List all non‑U.S. assets that could be “specified foreign financial assets” under the Instructions for Form 8938:
• Group 1: Financial accounts maintained by foreign financial institutions.
• Group 2: Other foreign financial assets held for investment that are not in an account (for example, an ownership interest in a foreign entity), as described in the instructions.
• Note: Directly held foreign real estate is generally not reported on Form 8938, but an interest in a foreign entity that owns real estate may be a specified foreign financial asset.
• Step C: Determine your category for thresholds:
• Filing status for the year (single, married filing jointly, married filing separately).
• Consider whether you are treated as living in the United States or abroad (as defined in the Instructions for Form 8938).
• Step D: Compare totals to Form 8938 thresholds:
• U.S. resident thresholds: more than $50,000/$75,000 (unmarried or married filing separately) or more than $100,000/$150,000 (married filing jointly).
• Living abroad thresholds: more than $200,000/$300,000 (unmarried or married filing separately) or more than $400,000/$600,000 (married filing jointly).
• If either your year‑end total or your “any time during the year” total exceeds the figure for your category, Form 8938 may be a question.
• Step E: In parallel, compare your foreign accounts to the FBAR considerations on the IRS comparison page to see whether an FBAR review is also appropriate.

When a tailored review is appropriate

• You hold layered structures (for example, an interest in a foreign entity that in turn holds accounts and investments). The instructions for Form 8938 discuss how entity interests are treated, and a tailored reading can prevent double counting or omissions.
• Your residence moved during the year, or your facts may fit the living‑abroad definition in the instructions. A focused review can help apply the correct threshold category.
• You have both Form 8938 and FBAR questions. The IRS comparison page is an excellent starting point; a tailored session can help align your asset list and valuations with both frameworks without over‑ or under‑reporting.
• You have asset types that are difficult to classify without the instruction definitions (for example, certain contracts, beneficial interests, or non‑account instruments with non‑U.S. counterparties).

Next steps you can take today

• Read the IRS — Instructions for Form 8938 with your asset list in hand.
• Open the IRS — Comparison of Form 8938 and FBAR requirements to see whether FBAR may also be on your list.
• If you live abroad, keep IRS Publication 54 nearby to understand how worldwide reporting fits into your broader tax picture.
• If you want personalized help applying the instructions to your documents, set up a focused discussion at /book-tax-session/.

Form 8938: Foreign Asset Reporting Decision Guide FAQs