IRS Form 926: filing requirements for US Expats and foreign corporations

IRS Form 926 is the information return that US persons file when transferring property to a foreign corporation. It generally applies to cash, stock, securities, tangible, and intangible property transfers, though several narrow exceptions can remove the filing requirement.

For cash transfers, Form 926 is required if you own at least 10% of the foreign corporation immediately after the transfer, or if the cash you or related persons transfer to that corporation during the 12-month period ending on the transfer date exceeds $100,000. The form also applies to transfers of stock, securities, tangible property, and intangible property.

Penalties start at 10% of the property's fair market value, capped at $100,000 unless the failure was due to intentional disregard.

If you are a US person who has funded a foreign company or contributed assets to one, the Form 926 filing requirements apply to your income tax return for the year of transfer. The form is informational and does not calculate tax on its own, but skipping it can be costly.

This guide covers who must file, the thresholds and exceptions, how to complete each part, and how Form 926 overlaps with Form 5471, FBAR, and Form 8938.

What is Form 926?

Form 926 is the IRS information return used by a US transferor to report property transfers to a foreign corporation. It is not filed separately. It is attached to the transferor's federal income tax return for the tax year that includes the transfer date, per the IRS instructions for Form 926.

The form is informational. It does not calculate or assess tax on its own. Its purpose is to give the IRS visibility into outbound transfers that could shift income or assets outside the US tax jurisdiction under IRC sections 367 and 6038B.

What Form 926 reports

Form 926 asks for the following information:

• The US transferor (name, ID number, entity type)
• The foreign corporation receiving the property
• A description of each transferred property, including type, value, and basis
• Any required supplemental statements for GRA, branch-loss, and intangible-property reporting

What Form 926 does not do

It does not replace your income tax return, and it does not eliminate the need for separate filings such as Form 5471, FBAR, or Form 8938 when those are independently triggered. A single transaction can require Form 926 plus one or more of those returns, which is covered in the comparison section below.

Reportable property is broad. The main categories that trigger tax Form 926 reporting are:

• Tangible property: real estate, machinery, equipment, inventory, and other physical assets
• Intangible property: patents, trademarks, copyrights, software, goodwill, and other IP rights
• Financial assets: cash, stock, securities, and similar instruments

For a wider view of how this form sits alongside other expat filings, see the TFX guide to US tax forms for expats.

Who must file Form 926?

Any US person who transfers property to a foreign corporation in an exchange described under IRC sections 367 or 6038B must file Form 926 with their income tax return for that year. The rule is not limited to individuals or large companies. It applies to any domestic entity making a qualifying outbound transfer, with the specifics laid out in Treas. Reg. §1.6038B-1.

The filing question comes down to two parts: are you a US person, and did you transfer property in a way that meets the reporting trigger.

Who counts as a US person for Form 926? 

Six categories of filers fall under the Form 926 filing requirement:

• US citizens, including expats living abroad
• US residents (green card holders and substantial presence test filers)
• Domestic corporations
• Domestic estates
• Domestic trusts
• Domestic partnerships, with special pass-through rules

Special rule for domestic partnerships

A domestic partnership does not file Form 926 itself. Instead, each US partner is treated as having made a proportionate share of the transfer and files their own Form 926 for that share. This catches a lot of expats off guard when they invest abroad through a US LLC.

Special rule for spouses

Married US persons who jointly own transferred property must each file separately, or file a single Form 926 jointly if they file a joint return. The form is not automatic for a non-filing spouse.

Why expats are commonly caught by this

If you have moved abroad and funded a foreign company, contributed equipment or IP to a foreign subsidiary, or restructured a US business into a foreign holding entity, you are almost certainly within scope. The same activity often triggers Form 5471 if you end up holding 10% or more of the foreign corporation, so the two filings frequently appear on the same return.

In plain terms, the answer to who is required to file Form 926 is any US person whose transfer crosses the thresholds covered in the next section. Being a small individual investor does not exempt you, and Form 926 filing requirements for individuals are identical in substance to those for corporations or trusts.

Form 926 filing deadline: when and how to file

Form 926 is due on the same date as your federal income tax return for the year in which the property transfer occurred. It is not filed separately. You physically attach it to your Form 1040 (or 1120, 1041, etc.) and submit it together, as confirmed by the IRS Form 926 filing requirement guidance.

For a 2025 calendar-year transfer, the standard deadline is April 15, 2026. For a 2026 transfer, the standard deadline shifts to April 15, 2027.

Key deadlines for expat filers

US persons living abroad get more time, but the rules are layered. Three deadlines matter for Form 926 reporting:

• April 15: standard filing date for the income tax return that Form 926 attaches to
• June 15: automatic two-month extension for US citizens and residents physically living outside the US on April 15
• October 15: extended deadline if you file Form 4868 by your applicable due date

The June 15 expat extension applies automatically. You do not request it, but you should attach a statement to your return noting that you qualify.

The full mechanics of stacking these extensions are covered in the TFX guide to filing deadlines for expats.

The payment deadline is separate

The June 15 extension covers filing, not payment. Interest accrues on any unpaid tax starting April 15, even if your return is not due until June 15 or October 15. If you expect to owe tax, pay an estimate by April 15 to stop the interest clock.

How to file Form 926

The form is filed in two ways, depending on how you submit your return:

• Paper return: print Form 926, attach it physically to your tax return, and mail to the IRS address listed in your tax return instructions
• Electronic return: your tax software submits Form 926 as part of the e-filed return package, with no separate submission required

You do not sign Form 926 itself. Signing the underlying income tax return covers it. All entries must be in English, and all dollar amounts must be reported in US dollars.

Key triggers for Form 926

Form 926 is triggered by specific outbound transfers, not by foreign ownership in general. Whether you have to file comes down to two things: the type of property you transferred, and whether the transfer crossed the thresholds set in Treas. Reg. §1.6038B-1 and the IRS Instructions for Form 926.

Below is a summary of the most common situations that pull a US person into the filing requirement.

When Form 926 may be required: common triggers and examples

For most US expats, the cash trigger is the one that bites first: any single transfer over $100,000, or any ownership stake of 10% or more after the transfer, brings Form 926 into play even when no tax is owed.

 

How the cash trigger works

The $100,000 figure is the Form 926 filing threshold most expats ask about, but it is not a single-transaction cap. The IRS aggregates all cash transferred by you and related persons to the same foreign corporation during the 12-month period ending on the transfer date. Six separate $20,000 wires in one year cross the threshold just as cleanly as one $120,000 wire.

The 10% ownership trigger operates independently. If you fund a foreign corporation and hold 10% or more of its voting power or value immediately after the transfer, Form 926 applies regardless of the dollar amount. Even a $5,000 contribution to set up a new entity you own outright is reportable.

Stock and securities transfers

Transfers of stock or securities to a foreign corporation usually fall under IRC §367(a), which treats the foreign corporation as a non-corporation for purposes of recognizing gain. If you want nonrecognition treatment, you generally must file a Gain Recognition Agreement (GRA) and attach Form 8838 to your return alongside Form 926.

This area overlaps heavily with controlled foreign corporation rules, and many transfers that trigger Form 926 also trigger Form 5471 in the same year.

The TFX guide to the controlled foreign corporation (CFC) framework explains how these filings interact.

Domestic liquidation distributions

When a US corporation liquidates and distributes property to a foreign parent or shareholder, the distribution generally falls within the Form 926 reporting threshold rules under IRC §367(e)(2). These transactions are technical, and the regulations carve out specific nonrecognition treatments depending on the assets distributed and the foreign recipient's status.

Form 926 instructions: what each part asks for

Form 926 is split into four parts, each capturing a different layer of the transfer.If a section needs more space, complete all entry fields on the form and attach a supplemental statement in the IRS format. Do not write 'see attached' in the form itself.

Part-by-part breakdown

The most common single mistake is leaving Part IV blank or marking "N/A" without checking whether a Gain Recognition Agreement or supplemental statement was actually required, which is what turns a routine filing into a penalty case.

 

IRS attachment rules you cannot skip

Several lines in Form 926 ask for supplemental statements rather than data on the form itself. Line 11 requires a written description of the property transferred under Regulations §1.6038B-1(c). Transfers of intangibles under IRC §367(d) require additional statements about useful life and anticipated income.

If a line requires a statement and you do not attach one, the IRS treats the form as incomplete. The same penalty rules apply as if you had not filed at all, which is covered in the next section.

Required currency and language

All Form 926 entries must be in English and in US dollars. If the property is denominated in a foreign currency, convert to US dollars before reporting.

Form 926 resources

Three official documents cover the filing in full, and you should have all three open before starting:

• The fillable form itself, available on the IRS Form 926 PDF
• The current IRS Instructions for Form 926, which include the supplemental statement rules
• Any related forms triggered by the same transfer (Form 8838 for GRAs, Form 5471 for CFC ownership, FBAR if foreign account balances exceed $10,000)

TFX handles international information returns end-to-end.

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Penalties and compliance

The standard Form 926 penalty is 10% of the fair market value of the property transferred, capped at $100,000. The cap disappears if the IRS determines the failure was due to intentional disregard, and a separate 40% accuracy-related penalty under IRC §6662(j) can apply when an undisclosed foreign financial asset understates your income.

The penalty applies even if no tax was owed on the underlying transfer. Form 926 is an information return, and the failure-to-file penalty operates independently of whether any tax was due.

Form 926 penalties at a glance

The headline figure is 10% of fair market value capped at $100,000, but the real exposure for expats with significant foreign holdings comes from the 40% IRC §6662(j) penalty and the open-ended statute of limitations under IRC §6501(c)(8).

 

How reasonable cause works in practice

Reasonable cause is not automatic. To claim it, you must promptly file an amended return that includes the missing Form 926, attach a written statement explaining the failure, and deliver the package to the IRS personnel handling any open examination, or to the appropriate Director of Field Operations if no exam is open.

The IRS evaluates whether you exercised ordinary business care and prudence. Common qualifying facts include reliance on a tax professional's advice on a matter of law, inability to obtain records, or death or serious illness in the household. The fact that a foreign jurisdiction would penalize disclosure is explicitly not reasonable cause.

The statute of limitations problem

A missing Form 926 keeps the assessment period open on the entire return, not just on the transfer. Under IRC §6501(c)(8), the statute does not begin to run until 3 years after the missing information is filed. A 2020 transfer reported on Form 926 in 2027 can keep your 2020 return audit-eligible until 2030.

If you missed prior years

For taxpayers who realize they should have filed Form 926 in prior years but did not, the IRS offers structured submission paths rather than informal late filing. Eligibility depends on whether the failures were willful and whether you also have unreported foreign income, and the mechanics are covered in the TFX guide to the Delinquent International Information Return Submission Procedures (DIIRSP).

When Form 926 may not be required

A handful of narrow exceptions can remove the Form 926 filing requirement, but they are technical and fact-dependent. Skipping the form based on an exception you assume applies, without confirming the regulation, is one of the most common ways expats end up with a 10% penalty. When in doubt, the safer route is to file.

The exceptions fall into four general categories under Treas. Reg. §1.367(a)-3 and the related regulations under §1.6038B-1.

Section 354 and 356 reorganizations

Form 926 generally does not apply if you exchange stock or securities in either of the following:

• A §368(a)(1)(E) recapitalization of a foreign corporation
• A §368(a)(1) asset reorganization of a domestic or foreign corporation that is not treated as an indirect stock transfer

Both situations sit under the §354 or §356 framework. The exception is narrow, and any indirect stock transfer pulls the transaction back into the filing requirement.

Stock or securities transfers below 5%

A US transferor who owns less than 5% of both the voting power and the value of the foreign corporation immediately after the transfer may be deemed to satisfy the reporting requirement if one of the following also applies:

• The transferor qualifies for nonrecognition treatment under the IRC §367(a) regulations
• The transferor is a tax-exempt entity, and the income is not unrelated business income
• The transfer was taxable under Treas. Reg. §1.367(a)-3(c) and the income was properly reported on a timely filed return
• The transfer falls under Treas. Reg. §1.83-6(d)(1) and the property transferred had a fair market value of $100,000 or less

These provisions only deem the reporting requirement satisfied. They do not eliminate it, so missing the underlying conditions reopens the full filing obligation.

Stock or securities transfers at 5% or more

If you own 5% or more of the transferee foreign corporation after a stock or securities transfer, Form 926 is generally required unless a specific exception applies. In some nonrecognition cases, the US transferor must enter into a Gain Recognition Agreement and file Form 8838.

In that case, you complete Parts I and II of Form 926 and report the FMV, adjusted basis, and gain recognized on the transferred stock. A late or missing annual GRA certification under §1.367(a)-8(g) breaks the exception and exposes you to the §6038B penalty regime.

Domestic corporation §355 distributions

A domestic corporation that distributes stock or securities of another domestic corporation under IRC §355 generally does not have to file Form 926. The exception does not apply if the §355 distribution involves a foreign controlled corporation and the distributee shareholders include persons who are not qualified US persons (US citizens, US residents, or domestic corporations).

Cash transfers below the threshold

A cash transfer to a foreign corporation is generally not reportable if both of the following are true:

• The transferor holds less than 10% of the foreign corporation immediately after the transfer
• Cash transfers by the transferor and related persons to the same foreign corporation during the 12-month period ending on the transfer date do not exceed $100,000

If either threshold is crossed, Form 926 applies regardless of how small the individual transfer was.

When the exceptions are not enough

Even when a transfer escapes Form 926, related filings can still apply. Foreign account balances above $10,000 trigger FBAR, and foreign financial assets above the threshold trigger Form 8938.

Form 926 examples for US expats

The clearest way to see when Form 926 reporting kicks in is to walk through the kinds of transfers expats actually make. Three illustrative scenarios below cover the most common triggers: cash funding a foreign startup, transferring software or IP, and contributing equipment to a foreign business.

These examples assume calendar-year filers and 2025 transfer dates. The numbers are simplified for illustration and do not substitute for analysis of your own facts.

Example 1: Funding a foreign startup with $120,000 cash

Illustrative. A US expat living in Portugal incorporates a Portuguese Lda. in March 2025 and wires $120,000 from a US bank account to capitalize the company. She owns 100% of the shares.

Both Form 926 triggers apply. She crosses the $100,000 cash threshold in a single transfer, and she holds 100% of the foreign corporation immediately afterward (well above the 10% test). She files Form 926 attached to her 2025 Form 1040, due by April 15, 2026, with the automatic expat extension available to June 15, 2026.

She also has to consider Form 5471 because she is the sole shareholder of a controlled foreign corporation, and FBAR if the company's US-funded bank account balance ever exceeds $10,000 during the year.

Example 2: Transferring software code to a foreign corporation

Illustrative. A US software developer relocates to Singapore in 2025 and assigns the source code of an existing application to his new Singapore Pte Ltd in exchange for 100% of its shares. The IRS values the software at $400,000 on the transfer date.

Form 926 applies regardless of dollar amount because intangible property transfers under IRC §367(d) are reportable on any value. The developer reports the FMV, his adjusted basis (which may be near zero if the software was self-developed), and any gain recognized.

Under §367(d), he is also treated as receiving annual deemed royalty payments from the Singapore company over the useful life of the software, which must be included in his US income each year going forward. This is one of the longest-tailed consequences of a Form 926 transaction.

Example 3: Contributing equipment to a foreign business

Illustrative. A US person living in Mexico contributes $40,000 of manufacturing equipment to a Mexican S.A. de C.V. in exchange for 25% of the company's shares. The other 75% is held by unrelated Mexican investors.

Form 926 applies. Tangible property transfers under IRC §6038B(a)(1)(A) are reportable at any dollar amount, and the 25% ownership stake is well above the 10% threshold for cash-equivalent treatment. He completes all four parts of the form, including a description of the equipment, its FMV on the transfer date, his adjusted basis, and any depreciation recapture.

He should also check whether the contribution qualifies for the §367(a)(3) active trade or business exception. Missing or late-filing Form 926 removes access to that exception, which can convert a nonrecognition transfer into a taxable one.

If the transfer involves a foreign partnership

These three examples all involve foreign corporations. If your contribution is to a foreign partnership rather than a foreign corporation, Form 926 does not apply, but Form 8865 likely does. For a broader background on cross-border business filings, the IRS international business portal is the main reference.

Form 926 vs Form 5471, FBAR, and Form 8938

A single transfer often triggers more than one international filing. Funding a foreign company in cash, for example, can require Form 926 (for the transfer), Form 5471 (for the ownership), FBAR (for the bank account), and Form 8938 (for the financial asset reporting). Each form covers a different angle, and filing one does not satisfy the others.

Comparison: international forms expats most often confuse

Form 926 reports a one-time outbound transfer; Form 5471 reports ongoing ownership of a foreign corporation; FBAR reports foreign account balances; Form 8938 reports foreign financial assets on the tax return; and Form 8865 covers foreign partnerships rather than corporations.

 

Why FBAR and Form 926 commonly appear together

When you wire cash from a US account to a foreign corporation's bank account, both forms can apply in the same year. Form 926 covers the transfer itself once it crosses the $100,000 or 10% triggers. FBAR covers any foreign account whose balance exceeds $10,000 at any point during the year, including the foreign company's account if you are a signatory.

FBAR is filed separately from your tax return, through FinCEN rather than the IRS. It has its own due date (April 15, with an automatic extension to October 15) and its own penalty structure, which is independent of Form 926.

How Form 926 interacts with Form 8938

Form 8938 covers specified foreign financial assets, including interests in foreign entities, on your income tax return. If the same foreign corporation interest also meets Form 8938 reporting thresholds under section 6038D, you may need to report it on both Form 926 and Form 8938.

Form 8838 and Gain Recognition Agreements

If your Form 926 covers a stock or securities transfer where you elect nonrecognition through a Gain Recognition Agreement, you must also file Form 8838 to extend the statute of limitations on the gain. Form 8838 attaches alongside Form 926 in that case. Missing the annual GRA certification under Treas. Reg. §1.367(a)-8(g) breaks the agreement and triggers full §6038B penalty exposure.

Conclusion: practical next steps

Form 926 is unusual in that it produces no tax bill by itself, but missing it creates penalty exposure that compounds across years. The five steps below cover the practical sequence for anyone preparing to file, or anyone who realizes they should have filed in a prior year.

1. Identify the transfer date and fair market value. Pin down the exact date the property crossed to the foreign corporation and the FMV in USD on that date. This determines which tax year the form attaches to and the base for any penalty calculation.
2. Check your ownership after the transfer. Calculate your direct, indirect, and attributed voting power and value in the foreign corporation immediately after the transfer. The 10% threshold is the most commonly missed trigger, especially for small cash contributions to entities you fully own.
3. Review related forms before filing. A single transfer often triggers Form 5471, FBAR, Form 8938, or Form 8838 alongside Form 926. The IRS international taxpayers portal lists current versions and instructions for each.
4. Attach Form 926 to your income tax return. Complete all four parts in English and US dollars, attach any required supplemental statements, and submit Form 926 with your Form 1040 by the applicable deadline (April 15, 2026, for 2025 transfers, with the automatic June 15 extension for expats and Form 4868 for October 15).
5. Get help if prior years were missed. If you should have filed Form 926 in a previous year and did not, options range from reasonable cause submissions to the Streamlined Foreign Offshore Procedures, depending on whether the failure was willful and whether you also have unreported foreign income.

The cost of filing Form 926 correctly is minor. The penalty is generally 10% of the property's fair market value, capped at $100,000 per failure unless the IRS finds intentional disregard, plus an open statute of limitations on the underlying return.

Worried about missed Form 926 filings or open exposure on prior returns?

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