Will TurboTax generate form 8621 automatically if I enter my dividends from my foreign mutual funds? And how can I report foreign mutual funds with no dividends? (2024)

FAQs

Will TurboTax generate form 8621 automatically if I enter my dividends from my foreign mutual funds? And how can I report foreign mutual funds with no dividends? ›

Form 8621 (Information Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund) is not included in the standard TurboTax software package. The return would need to be filed on paper with this attachment.

Yes, you can manually prepare and include Form 8621 with your printed TurboTax return and mail it to the IRS. However, it's essential to ensure that you follow the correct procedures to avoid any issues with your tax filing.

A U.S. person that is a direct or indirect shareholder of a passive foreign investment company (PFIC) files Form 8621 if they: Receive certain direct or indirect distributions from a PFIC. Recognize a gain on a direct or indirect disposition of PFIC stock.

It's classified as a Section 1291 Fund. This method allows for a deferral of US taxes until either (1) the earnings are distributed or (2) the PFIC is sold. Earnings are taxed as ordinary income, and the excess distribution is spread out over your investment period on a pro-rata basis.

Form 8621 should be filed along with your annual US income tax return (Form 1040). If you have multiple PFICs, a separate Form 8621 must be completed for each one. The form requires detailed information about the PFIC and your share of its income, gains, distributions, and any elections made.

The IRS requires U.S. owners of a PFIC to report ownership of their passive foreign investment companies on Form 8621. Common examples include foreign mutual funds and holding companies.

You are correct that no version of TurboTax supports IRS Form 8621, Information Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund. To include the Form 8621 with your federal tax return you will have to file a paper tax return.

Generally, a foreign mutual fund — as well as several other types of foreign equity funds — qualify as PFIC (Passive Foreign Investment Companies).

You can file Form 8621 online with H&R Block's Expat Tax Services. You may have to file more than one form—if you're required to file Form 8621, you must file a form for each PFIC in which stock is held. For example, if you have five funds in your portfolio, you need to file five forms 8621.

TaxAct offers three different tax software plans good for expatriates, ranging from $24.95 to $64.95 for each federal tax return. You'll get access to five of the most common tax forms expatriates need (Forms 1116, 2555, 8621, 8833, and 8938).

How do I declare foreign dividends on my taxes? ›

To report foreign dividend or interest income, enter the information as though you had received a Form 1099-DIV Dividends and Distributions or Form 1099-INT Interest Income, but leave off the Payer's Federal Identification Number.

Passive income is any type of income that would qualify as subpart F foreign personal holding company income if the recipient were a controlled foreign corporation (CFC) (e.g., dividends, interest, royalties, rents and annuities) .

Definitely, yes. If you are a US person, which includes citizens, dual nationals, Green Card holders, resident aliens, and domestic legal entities, you are subject to US tax on your global income. This global income includes money earned through foreign dividends.

Transparent Pricing: We offer competitive pricing for our Form 8621 Preparation Service. The base fee is $165 USD / $220 CAD per form when transactions are submitted in an excel format. Additional charges apply for transactions submitted using statements or other documents.

These regulations were published in the Federal Register on December 31, 2013, and are therefore effective as of that date. The regulations provide that all PFIC shareholders must file Form 8621 with their 2013 income tax returns and for all subsequent years.

Form 8938 Asks you if you Filed a Form 8621

Form 8621 is used to report any interest you may have (even fractional interest) in a Passive Foreign Investment Company. Like the 5471, you are not required to file and 8938 for any asset in which the current year you are filing form 8621.

You are correct that TurboTax does not support PFIC taxations or the reporting form, Form 8621 due to their very complex nature. You are only responsible for reporting on PFICs that you have owned since the date you became a U.S. person for tax purposes.

If you lived and worked in a foreign country, you might qualify for the foreign income exclusion. We'll ask questions to see if you qualify after you've entered your foreign income.