Hi and welcome to Just Answer!You do not need to report the fact of having a rental property on form 8938.
See instructions - http://www.irs.gov/pub/irs-pdf/i8938.pdf
Specified foreign financial assets include the following assets.1.Financial accounts maintained by a foreign financial institution.2.The following foreign financial assets if they are held for investment and not held in an account maintained by a financial institution:3.Stock or securities issued by someone that is not a U.S. person,4.Any interest in a foreign entity, and5.Any financial instrument or contract that has an issuer or counterparty that is not a U.S. person.In most cases, a foreign financial institution is any financial institution that is not a U.S. entity
Thus assets held with the US financial institution are not considered from 8938 reporting requirements.
However - as an US person - you are required to report all your worldwide income on your tax return - that include income received from rental property.Regardless if that a property in the US or abroad - rental income and rental expenses are reported on schedule E - www.irs.gov/pub/irs-pdf/f1040se.pdf
However - if the same income is taxable abroad and in the US - you may claim a credit for taxes paid abroad - so the same income would not be taxed twice. Use the form 1116 - http://www.irs.gov/pub/irs-pdf/f1116.pdf please find instructions here - http://www.irs.gov/pub/irs-pdf/f1116.pdfThe credit is limited by the US tax liability on the same income - the form 1116 is used to calculate the amount of credit. Means - if tax liability abroad is higher - there will not be US taxes on that income, but if tax liability abroad is lower - in the US you will pay the difference after the credit will be applied.
Let me know if you need any helpBe sure to ask for clarification if needed.
Thanks! How about selling the property? If I need to report the capital gain, loss, and tax paid in the foreign country, which IRS forms handle them?
Thanks! How about selling? If I need to report the capital gain, loss, or tax paid to the foreign country, which IRS forms handle them?
The sale of the rental property - regardless if the property is located in the US or abroad - is reported on the tax returns. Form 4797 is used to report the sale of business or rental property.The disposition of the property is reported on Form 4797 - http://www.irs.gov/pub/irs-pdf/f4797.pdf - is to report the disposition of business property - rental property in your situation. To calculate your gain or loss - you will use an adjusted basis. In additional - you will recapture the depreciation for the time the property was rented.
Let me know if you need help with reporting.