The Foreign Account Tax Compliance Act (FATCA) makes it possible for taxpayers of foreign citizenship to report worldwide income tax returns. The act was enacted in 2021 and applies to individuals who have lived in the US for any part of the year. Individuals may also report their income from foreign sources if they meet certain requirements.
If you are a taxpayer of any nationality, it is essential to report your worldwide income through the foreign bank. Many citizens of foreign countries to visit the United States frequently, particularly those with business interests in major US companies. Taxpayers living overseas can use an offshore bank account to maintain beneficial relationships with their friends and relatives back home. However, there are situations when these offshore accounts may be used improperly. For example, taxpayers can use foreign bank accounts to evade taxes by using them to pay expenses for vacations they took outside the country, or to avoid taxes on income derived from certain foreign sources such as interest from non-residential properties.
Taxpayers who need to file Form 89 38 may download and print a free electronic form that is available from the IRS website. This electronic form is a convenient way for taxpayers to file their federal income tax return (or the state form) electronically. There is no need to fax copies of signed forms as well as other documents to the designated address of the IRS office. Even though the forms are free, there is an opportunity for taxpayers to receive a refund if they file their returns electronically.