U.S. investors in passive foreign investment companies (PFIC) have to disclose their ownership on Form 8621 and include it with their tax return. U.S. investors may be able to make an MTM election for readily traded PFIC shares.
When a U.S. shareholder owns shares in a passive foreign investment company (PFIC), the shareholder must include a Form 8621 with their tax return. This article discusses the QEF election available to PFIC shareholders.
The IRS will often impose penalties if certain tax forms are filed late or never filed at all. Some of the highest penalties apply to forms related to foreign income and assets.
When a U.S. person opens a foreign corporation, they are often confronted with many additional tax filing obligations. The IRS Form 5471 is included with an income tax return to report the U.S. person's interest in the foreign corporation.
