U.S. Tax Reporting of Foreign Retirement Account Ownership and Distributions: New Proposed Regulations

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Course Details

Course Information

smart_display Format
On-Demand
signal_cellular_alt Difficulty Level
Intermediate
work Practice Area
Tax Preparer

Date & Time

event Date
Tuesday, July 30, 2024
schedule Time
1:00 p.m. ET./10:00 a.m. PT
timer Program Length
110 minutes

Credit Information

BARBRI is a NASBA CPE sponsor and this 110-minute webinar is accredited for 2.0 CPE credits.
BARBRI is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).

$197.00

This course will provide tax advisers with a comprehensive guide to understanding the reporting requirements of U.S. taxpayers with beneficial interests in foreign retirement accounts. Our panel of international compensation experts will review the recently released proposed regulations as they apply to pensions, annuities, social security equivalents, and other non-U.S. retirement accounts. The panel will present illustrations showing reporting from hypothetical foreign-based pensions and social security-type accounts.

Faculty

C. Edward Kennedy

Managing Director

C Edward Kennedy Jr, PC

Mr. Kennedy has more than 42 years of experience dealing with a variety of international tax matters, specializing in tax consulting services to a wide variety of clients ranging from closely held companies to multi-national businesses. His expertise includes domestic and foreign income and social security tax planning, tax compliance for individuals and corporations, tax treatment of incentive compensation plans, international assignment program administration, and international assignment policy design. Mr. Kennedy has also served as the U.S. practice leader for international social security matters for a Big 4 accounting firm. He is a frequent speaker in the areas of international tax compliance and reporting obligations U.S. information reporting requirements for foreign assets and foreign entities, U.S. tax implications of foreign pension and social security plans, and U.S. income and social tax treaty planning. Mr. Kennedy is a member of the Texas Bar and is licensed as a certified accountant in Georgia and Texas. He has a B.A. from Furman University and a J.D. from Vanderbilt University School of Law.

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James P. Klein

Senior Counsel

Pillsbury Winthrop Shaw Pittman LLP

Mr. Klein focuses his practice in the areas of executive compensation and benefits, and tax. He has broad experience servicing clients in the areas of employee benefits, retirement plans, insurance and in the international taxation of compensation and benefits, from the employee and employer perspective. He represents companies on U.S. and non-U.S. tax and labor issues and works with corporations in ensuring that their employee benefit plans comply with ERISA.

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Description

One of the more complicated and often misunderstood tax scenarios for taxpayers and practitioners occurs when a U.S. taxpayer owns a beneficial interest in a foreign pension plan or non-U.S. social security account. Taxpayers who live and work for significant periods in foreign countries and non-citizens who relocate to the U.S. and become U.S. taxpayers often participate in foreign-based retirement accounts. Most overseas plans are not qualified under IRC Section 401, meaning the accounts generally do not qualify for tax-deferral treatment. Such accounts may create unforeseen tax and reporting obligations.

In May 2024, Treasury released proposed regulations that impact foreign retirement plans. The proposed regulations modify the reporting exemptions initially identified under Rev. Proc. 20-17 in several ways. The proposed regulations expand the definition of retirement trusts which may be treated as "tax-favored foreign retirement trusts." The proposed regulations also address "tax-favored foreign non-retirement savings trusts," and establish a new exemption category for "tax-favored foreign de minimis savings trusts."

Another concern is the reporting obligation for ownership of foreign retirement assets. Taxpayers with foreign retirement account interests often must file informational reports, such as FBAR, FATCA reports, and IRS Form 3520. Gratefully, specific guidance exempts certain trusts from the burden of filing Form 3520, Annual Return to Report Transactions with Foreign Trusts.

Listen as our experienced panel provides comprehensive guidance on the tax and reporting requirements of ownership of foreign retirement accounts.

Outline

Classifications of foreign pensions, annuities, and social security
Income calculations: distributions and ownership
Differentiation between most foreign plans and U.S.-qualified plans
Proposed regulations
Informational reporting
Case study and illustrations

Benefits

The panel will discuss these and other critical topics:

How the new proposed regulations modify Revenue Procedure 20-17
What are the reporting requirements for U.S. taxpayers participating in foreign retirement accounts?
What are the tax consequences for U.S. taxpayers when employers contribute to foreign retirement accounts?
What is the tax impact of distributions from foreign retirement accounts for U.S. taxpayers, whether they reside in another country or the U.S.?
New thresholds and contribution limits under the proposed regulations

NASBA Details

Learning Objectives

After completing this course, you will be able to:

Ascertain the reporting requirements for U.S. taxpayers participating in foreign retirement accounts
Differentiate between most foreign plans and U.S. "qualified plans"
Select which IRS forms are necessary to fulfill obligations to report foreign financial assets and interests with both the IRS and FinCEN
Recognize tax provisions, including deferral provisions, in relevant tax treaties
Recognize the interaction of Forms 8938, 3520, and FBARs

Field of Study: Taxes
Level of Knowledge: Intermediate
Advance Preparation: None
Teaching Method: Seminar/Lecture
Delivery Method: Group-Internet (via computer)
Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
Prerequisite: Three years+ business or public firm experience at mid-level within the organization, preparing complex tax forms and schedules for U.S. taxpayers owning or receiving payments from non-US retirement accounts; supervisory authority over other preparers/accountants. Specific knowledge and understanding of basic reporting requirements for U.S. taxpayers with foreign retirement account interests; familiarity with FBAR, FATCA and For 3520 filings

Strafford Publications, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.