Foreign Tax Paid

[gman]

of $6.00. What is the requirement to attach Form td f 90-22.1

[Koss]

Not Applicable

(1) Form TD F 90-22.1, when it is required, is not filed with the tax return. It is filed separately. It has its own filing address, and its own due date.

(2) In general, the form must be filed when the taxpayer answers yes to the question on Line 7a of Schedule B. According to the instructions for Schedule B, this question should not be answered yes when the taxpayer owns foreign securities that are held in a US securities account.

What you described in your post sounds like foreign tax paid by a mutual fund. As long as the mutual fund shares are held in an account at a US financial institution, there is no requirement to file Form TD F 90-22.1.

The purpose of Form TD F 90-22.1 is to allow the IRS to identify taxpayers who have foreign accounts that are not subject to US reporting requirements, i.e., accounts at institutions that are beyond US jurisdiction, and are not required to issue 1099 series information returns.

This concept is not applicable to US mutual fund accounts.

See, inter alia, the IRS FAQ on this topic, at the following link:

http://www.irs.gov/businesses/small/article/0,,id=148845,00.html

Also see IRS Notice 10-23, at the following link, for various other exceptions to the reporting requirements. This notice refers to "foreign commingled funds," and it appears that ownership of such funds may in fact trigger a reporting requirement. But US mutual funds that happen to own foreign stocks are not "foreign commingled funds." They are US securities accounts. The very existence of the Form 1099, which reports the foreign tax paid, obviates the need for Form TD F 90-22.1. The IRS already knows about the account in question.

http://www.irs.gov/pub/irs-drop/n-10-23.pdf

BMK