Reporting Maximum Value

You must report the maximum value during the tax year of each specified foreign financial asset reported on Form 8938. In most cases, the value of a specified foreign financial asset is its fair market value. An appraisal by a third party is not necessary to estimate the maximum fair market value during the year. See Valuing Financial Accounts and Valuing Other Specified Foreign Financial Assets , later.

Assets With No Positive Value

If the maximum value of a specified foreign financial asset is less than zero, use a value of zero as the maximum value of the asset.

Foreign Currency Conversion

If your specified foreign financial asset is denominated in a foreign currency during the tax year, the maximum value of the asset must be determined in the foreign currency and then converted to U.S. dollars.

In most cases, you must use the U.S. Treasury Bureau of the Fiscal Service foreign currency exchange rate for purchasing U.S. dollars. You can find this rate on fiscal.treasury.gov/fsreports/rpt/ treasRptRateExch/ treasRptRateExch_home.htm . If no U.S. Treasury Bureau of the Fiscal Service exchange rate is available, you must use another publicly available foreign currency exchange rate for purchasing U.S. dollars and disclose the rate on Form 8938.

Currency Determination Date

Use the currency exchange rate on the last day of the tax year to figure the maximum value of a specified foreign financial asset or the value of a specified foreign financial asset for the purpose of determining the total value of your specified foreign financial assets to see whether you have met the reporting threshold. Use this rate even if you sold or otherwise disposed of the specified foreign

Interests in Assets Held by Disregarded Entities

If you are the owner of a disregarded entity, you have an interest in any specified foreign financial assets owned by the disregarded entity.

Interests in Jointly Owned Assets

A joint owner of an asset has an interest in the entire asset. For special rules for interests in assets jointly owned by spouses, see Joint Interest Valuation, earlier, and Reporting the Value of Jointly Owned Assets , later.

Interests in Assets Held in Financial Accounts

If you have an interest in a financial account that holds specified foreign financial assets, you do not have to report the assets held in the account.

Interests in Assets Generating Certain Unearned Income of Children

If you file Form 8814, Parents' Election To Report Child's Interest and Dividends, with your income tax return to elect to include in your gross income certain unearned income of your child (the “kiddie tax” election), you have an interest in any specified foreign financial asset held by the child.

Interests in Assets Held by Entities That Are Not Disregarded Entities

In most cases, you do not own an interest in any specified foreign financial asset held by a partnership, corporation, trust, or estate solely as a result of your status as a partner, shareholder, or beneficiary.

Interests in Assets Held by Grantor Trust

If you are considered the owner under the grantor trust rules (sections 671 through 679) of any part of a trust, you have an interest in any specified foreign financial asset held by that part of the trust you are considered to own. For exceptions from reporting for owners of certain domestic

investment or bankruptcy trusts, see Domestic Investment Trusts and Domestic Bankruptcy Trusts, later.

Interests in Foreign Estates and Foreign Trusts

An interest in a foreign trust or a foreign estate is not a specified foreign financial asset unless you know or have reason to know based on readily accessible information of the interest. If you receive a distribution from the foreign trust or foreign estate, you are considered to know of the interest.

Interests in Foreign Pension Plans and Foreign Deferred Compensation Plans

Report in Part VI your interest in the foreign pension plan or foreign deferred compensation plan. Do not separately report the assets held by the plan. See Valuing Interests in Foreign Estates, Foreign Pension Plans, and Foreign Deferred Compensation Plans , later.