IRS and Social Security Forms

It is almost Income Tax filing time again, but when you think you have completed every form that the IRS wants, think again. There are just a few more plus one from Social Security.

These are the forms that the IRS and Social Security require that you complete each year if you are living abroad.  Just to give you a quick review of these forms:

  1. IRS form 8938 is to list assets held outside of the US, this form is only required if you file a tax return.
  2. SS form 7162 is to update Social Security of your current status. This is required if you have informed Social Security of your move outside of the US or are receiving your Social Security payments outside of the US. This is required annually.
  3. IRS FBAR is required to list any bank accounts held outside of the US if at any time during the year you had an aggregate total of $10,000 in those foreign accounts. This is required annually.

A more detailed description is listed below:

  • The IRS requires that Form 8938 Statement of Specified Foreign Financial Assets be completed as part of your tax return

The IRS requires that you submit Form 8938 (Statement of Specified Foreign Financial Assets) should be filed by taxpayers with specific types and amounts of foreign financial assets or foreign accounts.  It is important for taxpayers to determine whether they are subject to this new requirement because the law imposes significant penalties for failing to comply.

Form 8938, the instructions, regulations implementing this new foreign asset report, and other information to help taxpayers determine if they are required to file Form 8938 is available on the web at: http://www.irs.gov/businesses/corporations/article/0,,id=236667,00.html .

  • Social Security requires that you submit a completed form 7162 each year

The FEP is one of the integrity measures used by the Social Security Administration (SSA) to verify the existence and identity of beneficiaries living outside the United States. It does not apply to countries where Treasury restrictions prohibit delivery of SSA payments (see RS 02650.001C.). Contacts are made annually or biennially to help us determine if any events have occurred that affect the beneficiaries’ eligibility to benefits or their ability to handle their own funds.

https://secure.ssa.gov/poms.nsf/lnx/0302655001

  • The IRS requires that the FBAR form be filed:

If you have a financial interest in or signature authority over a foreign financial account, including a bank account, brokerage account, mutual fund, trust, or other type of foreign financial account, the Bank Secrecy Act may require you to report the account yearly to the Internal Revenue Service by filing Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts (FBAR).

The FBAR is required because foreign financial institutions may not be subject to the same reporting requirements as domestic financial institutions. The FBAR is a tool to help the United States government identify persons who may be using foreign financial accounts to circumvent United States law. Investigators use FBARs to help identify or trace funds used for illicit purposes or to identify unreported income maintained or generated abroad.

http://www.irs.gov/businesses/small/article/0,,id=148849,00.html

We complete these forms and have someone going back to the states take them with them to mail. Our friend Joe Tana has just mailed ours this week.

15 thoughts on “IRS and Social Security Forms

  1. Pingback: Morning Update – Thursday, April 12, 2012 « South of Zero

  2. Technically, I believe that the TD F 90-22.1 must be filed directly with the Treasury Department in Detroit, not with the IRS which is a bureau of the Treasure Department. Admittedly a minor point, but one which I believe is accurate.

    • TommyT, thanks for your comment. I am not a tax adviser, just a women with a blog trying to help out in my small way. I gave the full website info for anyone who is required to complete these forms or thinks they may be required to complete these forms. I hope everyone reads the instructions and follows them to where they need to be mailed.

      Thanks again for your observations, do you live here in Ecuador currently? Do you have a background in tax or legal, we could sure use someone with that expertise to keep us all out of trouble. When we lived in Panama there was a woman who just did a forum about legal issues, we still refer to her site because many of her posts are general legal/IRS/SS issues that pertain to any country…If you have that background you would be very welcome to keep us all informed of changes. Thanks again, Nancy

  3. In addition, could you please explain the form SSA-7162-OCR-SM procedure. From reading the SSA instructions, it appears that the form is sent out from the SSA annually and only requires one to return the completed form to SSA if certain changes in their personal status has occurred. Please clarify. Thanks

    • Hi Again Tommy T, I wanted to be sure about this form so I sent an email to the US Consulate in Quito and just got the reply. According to them this form is required every other year. I know for sure that someone told us to complete it every year, so we complete it annually. Living outside of the US is not always a picnic but it sure is an adventure! Have a wonderful day, Nancy

  4. No I am not a tax person. I had just completed my first year in Ecuador in February and had consulted a tax expert in the US for his advice prior to filing the required reports and returns for last year. Your blog this morning caused a little concern as I had not heard about any additional required SSA filings. Hence the reason for my second reply. My first was only to clarify where to file that particular form.

    • Hi TommyT, Sorry you are not a tax guy, we could sure use one. Hope your tax expert completed all the forms that the IRS / Department of the Treasure and Social Security needs from you. I file my own taxes so I must try to keep all of these forms and deadlines for forms someplace to remind me, that is where the blog is very helpful.

      I am enjoying the sun on my porch this afternoon, hope you are doing the same. Nancy

  5. Thanks for the follow up – As for the SSA form, your plan is probably the best. BTW, so far, I’ve had no problem sending mail to the SSA, the Treasury, or the IRS via the local post office. I also file my own taxes and have done so for years using TurboTax . FYI, I’ve received several things from the SSA over the last 14 months delivered directly to my home. It’s raining in Cuenca this evening – but that’s normal for this time of year. My porch is too wet right now! TT

    • Hi, I wish we had a post office here in Playas, I think the closest is either Salinas or the bus terminal in Guayaquil so having a PO Box is not an option right now. We have only received one letter in the seven months we have been living here so I really cannot depend on the post office getting us any mail in a timely fashion. Sorry it was raining, it was just beautiful here yesterday. Thanks again for your comments, Nancy

  6. Dear Nancy-

    Thank you for sharing the information. We publish different tax articles that can be useful for American expats. We specialize in US tax preparation for Americans abroad. I can send you more information if you are interested. Thank you.

    Zhanna, CPA
    Artio Partners

    • Dear Zhanna CPA, Any tax information that you are willing to share with the Expats that read my blog would be appreciated. Thanks for your help, Nancy

  7. Dear Nancy-

    Nice to hear from you. Hope you have a nice Sunday. What is the best way to share the information? Should I send it to your email address? If so, could you send a message to my email address? I didn’t find your email address on the
    website. Thank you. Zhanna.

    • Hi again Zhanna, I have sent you an email for you to be able to forward any information to me. Thanks again, Nancy

  8. I am in Brazil and I have the SSA form in front of me. My problem is that I don´t know if I should mark NO in all questions because nothing has changed for me in the last three years or if I should go into question 5 and fill up all the information required. Any guidelines?

    • Hi Mark, I am by no means an expert on these Social Security forms. If you are completing SSA 21 this is the guidelines that I find on the web… https://secure.ssa.gov/poms.nsf/lnx/0200205180
      if you are completing form 7162 this is all I could find http://www.ssa.gov/pubs/10137.pdf and this http://chile.usembassy.gov/benfed-form7162.html

      Each year that we have been out of the country we answer each questions accurately…We have moved from the US to Panama in 2006 and then in 2009 to Ecuador BUT we have never changed citizenship….As soon as we moved each time we contact the US Consulate in the country we are living in and give them a change of address…so when we complete form 7162 we report NO to question 3. On question 4 our marital status has not changed so that is also NO. on Question 5 we have never worked while outside of the US so this is also NO. We do not answer question 6 because it does not pertain to us. Because we answered NO to 3, 4 and 5 we do not need to complete anything on page two except to sign and date — a witness is not required because Joe can sign his name. Then we scan these two pages along with the one page of Joe’s passport that has his photo on it and email all three pages to the US Consulate in Quito. They send us a receipt and will forward to the US Social Security office. If you have any questions you really need to contact the US Consulate closest to where you are living in Brazil and get further clarification. I hope this helps, best of luck, Nancy

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