What are the differences between Fincen 114 and 8938 in relation to cryptocurrency?

1 answers

• Danish Abyan PratistaMay 03, 2022 · 4 years ago
  As an expert in the field, I can tell you that Fincen 114 and 8938 reporting requirements are crucial for cryptocurrency holders. Failing to comply with these regulations can result in severe penalties and legal consequences. Fincen 114, also known as FBAR, requires individuals to report their foreign financial accounts, including cryptocurrency, if the aggregate value exceeds $10,000 at any time during the year. Form 8938, on the other hand, requires reporting of specified foreign financial assets, including cryptocurrency, based on different thresholds depending on the taxpayer's filing status and residency. It is important to note that both forms require reporting of cryptocurrency holdings, regardless of whether they are held inside or outside the US. Cryptocurrency holders should consult with a tax professional to ensure compliance with these reporting requirements and avoid any potential issues with the IRS.
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