The Wall Street Journal articles indicates the IRS is now getting smarter. They are starting to examine offshore insurance products owned by US taxpayers. These policies are often used to hide foreign assets and foreign income not being reported on the tax returns of their US owners. If you have cash surrender value or assets in a foreign life insurance policy you are required to show that policy on your US FBAR each year and may be required to report the income. It would also go on form 8938 if you are required to file that form. If the policy holds foreign mutual funds you may be required to file the form reporting Passive Foreign Investment Companies also to avoid adverse tax consequences.
READ ARTICLE HERE
READ ARTICLE HERE
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