On part 1 and 2 of the 8938 it states;
If you have more than one account to report, attach a continuation sheet with the same information for each additional account (see instructions).
With this in mind, if you have, say 4 accounts, and each account has a reportable tax item , would you tabulate the total sum of all 4 account on Part 3 of the first page of the 8938, or are you supposed to place each individual reportable tax item on the bottom (part 3) of each attached continuation sheet?
I ask this because Part 3 makes reference to Summary of Tax Items Attributable to Specified Foreign Financial Assets.
Part 3 of 8938
Moderator: Mark T Serbinski CA CPA
I can't tell you what to do, but I can tell you what I did.
I put each additional account on a separate 8938 continuation sheet. On Part III of that sheet, I put the tax item(s) for that one single account. I have one account that produces both interest and dividends, so for that account's Part III, there are two tax items.
I organized Schedule B to be a perfect match to the ensemble of the 8938s. So the way I did it allows the IRS to see that each account's income is matched exactly by an item on Schedule B.
Someone more knowledgeable may have other advice.
I put each additional account on a separate 8938 continuation sheet. On Part III of that sheet, I put the tax item(s) for that one single account. I have one account that produces both interest and dividends, so for that account's Part III, there are two tax items.
I organized Schedule B to be a perfect match to the ensemble of the 8938s. So the way I did it allows the IRS to see that each account's income is matched exactly by an item on Schedule B.
Someone more knowledgeable may have other advice.
Thanks Filo,
I just got off the phone with the IRS and buddy basically would not answer any questions about filling out the form...kept stepping over me telling my everything is on the instructions page.
He did tell me that i should only need one form because you can put multiple accounts on it...but i do not see more than 1 part 1 or part 2.
I am just looking for a simple format on how one would tablulate 5 or 6 accounts...maybe i am reading too much into this, but i suppose i will have to do it my way.
I just got off the phone with the IRS and buddy basically would not answer any questions about filling out the form...kept stepping over me telling my everything is on the instructions page.
He did tell me that i should only need one form because you can put multiple accounts on it...but i do not see more than 1 part 1 or part 2.
I am just looking for a simple format on how one would tablulate 5 or 6 accounts...maybe i am reading too much into this, but i suppose i will have to do it my way.
I put "8938 continuation sheet" into Google and got one site that my antivirus program blocked (saying the site would install a trojan), a second site that appeared to be garbage, and a third site that wasn't helpful. And the IRS does not supply a continuation sheet.
As I said previously, for continuation sheets I used one sheet for each single additional account or asset. The continuation sheet was an 8938 with the "8938" in the upper left corner scratched out and with a handwritten title at the top saying "Form 8938 Continuation Sheet".
If you buy tax software, probably it will be able to provide you with some kind of 8938 continuation sheet.
If you design a continuation sheet yourself, these are the problems --
-- It takes more time to do the layout of a multi-item sheet than it would to just fill out separate single-item sheets.
-- For a Part I sheet of a half dozen accounts, you would probably choose to put the equivalent of Part III in separately for each listed account. Is that acceptable to the IRS or not? No clue.
-- For a Part II sheet of a half dozen non-account assets, same problem.
As I said previously, for continuation sheets I used one sheet for each single additional account or asset. The continuation sheet was an 8938 with the "8938" in the upper left corner scratched out and with a handwritten title at the top saying "Form 8938 Continuation Sheet".
If you buy tax software, probably it will be able to provide you with some kind of 8938 continuation sheet.
If you design a continuation sheet yourself, these are the problems --
-- It takes more time to do the layout of a multi-item sheet than it would to just fill out separate single-item sheets.
-- For a Part I sheet of a half dozen accounts, you would probably choose to put the equivalent of Part III in separately for each listed account. Is that acceptable to the IRS or not? No clue.
-- For a Part II sheet of a half dozen non-account assets, same problem.
I think i will do the same as you did regarding the continuation sheets.
i am going to place all the dollar values (cumulative) on part 3 of the first 8938 form, along with my check marked 3520 for my 8891 form.
I will then tabulate the rest of my continuation sheets and right next to the 8938 write "continuation" (in crayon)
An interesting bit of information for you....i was told by two Accountants so far that i must include my Canadian RRSP information on the 8938. I was confused by this as it tells you in plain english (as plain as the IRS can get) that if you tabulate an 8891 form (which i did for my RRSP deferral election), then all i need to do is check mark the box for '3520' and add '1'.
As far as i know thats it....i do not have to list the RRSP on the 8938.
Another Accountant told me to use average exchange rate values for the 8938....again am i missing something here?? does it not say to use the rate for the last day of your tax year...in my case December 31st? (1.0180)
these are not novices i am talking about...these are (so called) professionals with large named Firms. The kind of folks that charge you 500 clams for a consultation.
if i was this ill informed in my line of work...i would be out of a job right now.
thanks for letting me vent :)
i am going to place all the dollar values (cumulative) on part 3 of the first 8938 form, along with my check marked 3520 for my 8891 form.
I will then tabulate the rest of my continuation sheets and right next to the 8938 write "continuation" (in crayon)
An interesting bit of information for you....i was told by two Accountants so far that i must include my Canadian RRSP information on the 8938. I was confused by this as it tells you in plain english (as plain as the IRS can get) that if you tabulate an 8891 form (which i did for my RRSP deferral election), then all i need to do is check mark the box for '3520' and add '1'.
As far as i know thats it....i do not have to list the RRSP on the 8938.
Another Accountant told me to use average exchange rate values for the 8938....again am i missing something here?? does it not say to use the rate for the last day of your tax year...in my case December 31st? (1.0180)
these are not novices i am talking about...these are (so called) professionals with large named Firms. The kind of folks that charge you 500 clams for a consultation.
if i was this ill informed in my line of work...i would be out of a job right now.
thanks for letting me vent :)
"i am going to place all the dollar values (cumulative) on part 3 of the first 8938 form"
-- It wouldn't be any more difficult to put the individual tax item for a specific account/asset each on its own form. The advantage to that is that the IRS will be able to see plainly from Schedule B that you have correctly accounted for each acct/asset on the 8938. In my opinion, the word "Summary" on the Part III table is just a word that someone thought looked nice in the title; "Summary" doesn't imply cumulative.
"i was told by two Accountants so far that i must include my Canadian RRSP information on the 8938."
-- Last November, that issue was still up in the air. As of now, however, although the IRS was too lazy too change the form, it *did* change the instructions, clearly stating that 8891 accounts did not have to be duplicated on the 8938, and that the 3520 box should be used for them in Part IV. Your accountants didn't read the 8938 instructions.
"Another Accountant told me to use average exchange rate values for the 8938....again am i missing something here?? does it not say to use the rate for the last day of your tax year...in my case December 31st? (1.0180)"
-- You're right. December-31 rate, $ 1 US per $ 1.0180 Cdn.
"these are not novices i am talking about...these are (so called) professionals"
-- They need reading lessons.
-- It wouldn't be any more difficult to put the individual tax item for a specific account/asset each on its own form. The advantage to that is that the IRS will be able to see plainly from Schedule B that you have correctly accounted for each acct/asset on the 8938. In my opinion, the word "Summary" on the Part III table is just a word that someone thought looked nice in the title; "Summary" doesn't imply cumulative.
"i was told by two Accountants so far that i must include my Canadian RRSP information on the 8938."
-- Last November, that issue was still up in the air. As of now, however, although the IRS was too lazy too change the form, it *did* change the instructions, clearly stating that 8891 accounts did not have to be duplicated on the 8938, and that the 3520 box should be used for them in Part IV. Your accountants didn't read the 8938 instructions.
"Another Accountant told me to use average exchange rate values for the 8938....again am i missing something here?? does it not say to use the rate for the last day of your tax year...in my case December 31st? (1.0180)"
-- You're right. December-31 rate, $ 1 US per $ 1.0180 Cdn.
"these are not novices i am talking about...these are (so called) professionals"
-- They need reading lessons.