Instructions For Form 8621 - 2016 (Page 4 of 14) in pdf

space between each such number. As

respect to the PFIC, unless another

the stock of the PFIC. Temporary

indicated above, the length of a given

shareholder through which the indirect

Regulations section 1.1298-1T(b)(3)(iii).

reference ID number is limited to 50

shareholder owns the PFIC files under

Exempt organizations. In general, if

characters and each number must be

section 1298(f) with respect to the PFIC

a shareholder of a PFIC is a tax exempt

alphanumeric and no special characters

and no other exception applies,

organization, the shareholder is

are permitted.

Is required to include an amount in

required to complete Part I only if

income under section 1296(a) with

income derived with respect to the PFIC

Note. This correlation requirement

respect to the PFIC, unless another

would be taxable to the shareholder

applies only to the first year the new

shareholder through which the indirect

under subchapter F. Temporary

reference ID number is used.

shareholder owns the PFIC files under

Regulations section 1.1298-1T(c)(1).

section 1298(f) with respect to the PFIC,

Exception if aggregate value of

Part I. Summary of Annual

shareholder’s PFIC stock is $25,000

Is required to report the status of a

Information

or less. A shareholder is not required

section 1294 election with respect to the

to complete Part I with respect to a

PFIC.

Who Must Complete Part I

specific section 1291 fund if the

See Temporary Regulations section

In general, all shareholders required to

shareholder meets the $25,000

1.1298-1T(b)(2) for further information.

file Form 8621 under section 1298(f)

exception on the last day of the

Domestic grantor trusts. In general,

and the regulations thereunder must

shareholder’s taxable year. For

a U.S. grantor of a domestic grantor

complete Part I. However, a shareholder

purposes of determining whether a

trust that owns an interest in a PFIC

of a PFIC that is marked to market

shareholder satisfies the $25,000

(directly or indirectly) through one or

under a Code provision other than

threshold, the shareholder takes into

more foreign entities must complete

section 1296 (such as section 475) is

account all PFIC stock (QEFs, section

Part I with respect to that PFIC interest.

not required to complete Part I unless it

1291 funds, and PFIC stock subject to a

Temporary Regulations sections

is subject to section 1291 with respect

section 1296 mark-to-market election)

1.1291-1T(b)(8)(iii)(D) and 1.1298-1T(b)

to the PFIC pursuant to Regulations

owned directly or indirectly other than

(1)(iii). In those circumstances, a

section 1.1291-1(c)(4)(ii). See Notice

PFIC stock owned through another U.S.

domestic grantor trust is not required to

2014-51.

person or PFIC stock owned through

complete Part I with respect to the stock

another PFIC. Shareholders filing a joint

Shareholders filing a joint return may

of the PFIC that is owned by the grantor.

return have a combined threshold of

file a single Form 8621 with respect to a

For certain exceptions, see Temporary

$50,000 instead of $25,000 for

single PFIC in which each joint filer

Regulations section 1.1298-1T(b)(3)(i).

purposes of this exception.

owns an interest.

Exceptions to Filing Part I

For more information, see Treasury

Shareholders that are the first U.S.

Regulation section 1.1298-1T(c)(2).

A shareholder is exempt from

person in the chain of ownership.

completing Part I if it meets one of the

Exception if the value of sharehold-

Temporary Regulations section

exceptions described below.

er’s indirect PFIC stock is $5,000 or

1.1298-1T generally requires a U.S.

less. A shareholder is not required to

person that is at the lowest tier in a

Special rules for estates and trusts.

complete Part I with respect to indirect

chain of ownership (i.e., the first U.S.

Certain U.S. grantors and beneficiaries

ownership of a specific section 1291

person in the chain of ownership) and

of estates and trusts may qualify for an

fund if the shareholder meets the

that is a shareholder (including an

exception to filing Part I.

$5,000 exception with respect to the

indirect shareholder) of a PFIC to

A U.S. grantor of a domestic grantor

section 1291 fund on the last day of the

complete Part I for each PFIC owned by

trust is not required to complete Part I if

shareholder’s taxable year. For

that shareholder during the

the trust is a domestic liquidating trust or

purposes of determining whether a

shareholder’s taxable year.

a widely held fixed investment trust, as

shareholder satisfies the $5,000

Specific filing requirements apply

described in Temporary Regulations

threshold, the shareholder takes into

with respect to domestic grantor trusts,

section 1.1298-1T(b)(3)(i). In these

account only the value of the

as described further in these

circumstances, the domestic grantor

shareholder’s proportionate share of the

Instructions.

trust is required to complete Part I.

section 1291 fund.

In certain situations, a U.S. grantor of

Exceptions to these filing

For more information, see Treasury

a foreign grantor trust that owns an

requirements are described below

Regulation section 1.1298-1T(c)(2).

interest in a PFIC is not required to

under “Exceptions to Filing Part I.”

complete Part I with respect to the PFIC

Line Instructions

Shareholders that are not the first

if the foreign trust is a foreign pension

U.S. person in the chain of owner-

fund. Temporary Regulations sections

Line 1. Describe each class of shares

ship. In general, an indirect

1.1291-1T(b)(8)(iii)(D) and 1.1298-1T(b)

held by the shareholder.

shareholder that is not the first U.S.

(3)(ii).

Line 2. Provide the date during the tax

person in the chain of ownership is not

A U.S. beneficiary of a foreign

year that the shares were acquired, if

required to complete Part I unless the

non-grantor trust or foreign estate is not

applicable.

indirect shareholder:

required to complete Part I with respect

Is treated as receiving an excess

Line 3. List the number of shares held

to the stock of the PFIC that is owned by

distribution from the PFIC,

at the end of the taxable year.

the trust or estate unless it has made a

Is treated as recognizing gain that is

QEF or section 1296 mark-to-market

Line 4. Indicate the value of the shares

treated as an excess distribution as a

election, received an excess

held at the end of the taxable year.

result of a disposition of the PFIC,

distribution, or recognized gain treated

Shareholders may rely upon periodic

Is required to include an amount in

as an excess distribution with respect to

account statements provided at least

income under section 1293(a) with

-4-

Instructions For Form 8621 - 2016 Page 4

Related Articles

Related forms

Related Categories