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Final regulations: Reporting requirements for shareholders of PFICs

Reporting requirements for shareholders of PFICs

The U.S. Treasury Department and IRS today released for publication in the Federal Register final regulations (T.D. 9806) as guidance:


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  • On determining the ownership of a passive foreign investment company (PFIC)
  • Concerning the annual filing requirements for PFIC shareholders
  • With respect to an exclusion for certain filing requirements for shareholders that constructively own interests in certain foreign corporations

The final regulations provide rules with respect to annual reporting requirements for shareholders of PFICs to file Form 8621, Information Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund, and about an exception to the requirement for certain shareholders of foreign corporations to file Form 5471, Information Return of U.S. Persons with Respect to Certain Foreign Corporations.

Read text of the final regulations [PDF 235 KB] 


Prior to today's final regulations, there were  proposed regulations (and temporary regulations) issued in December 2013, and subsequently, two IRS notices.

  • Notice 2014-28 announced that the regulations under section 1291 would provide that a United States person that owns stock of a PFIC through a tax-exempt organization or account is not treated as a shareholder of the PFIC with respect to the stock.
  • Notice 2014-51 announced that the regulations under section 1298 would provide guidance concerning United States persons that own stock in a PFIC that is marked to market under a provision of chapter 1 of the Code other than section 1296.

The preamble to today’s release further explains that the final regulations retain the basic approach and structure of the 2013 proposed regulations, "with certain revisions" and include measures for implementing the rules described in Notice 2014-28 and Notice 2014-51, and remove the corresponding 2013 temporary regulations.

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