Who is Required to File the New BE-10 Report?
There is a new filing requirement for US Persons who own or have ownership in foreign entities. The BE-10 started out as a survey and is now mandatory for US Persons.
If you are a US Expat, you may or may not have heard about the most recent reporting requirement in the form of the BE-10 – a survey which is conducted every five years by the BEA (Bureau of Economic Analysis) to identify the number of entities overseas. It used to be that the BEA would select certain individuals to participate in the survey. This year, though, it’s changed. Any US Person who is affiliated with a foreign entity is required to file the BE-10. To be affiliated with a foreign entity, you must own or control (indirectly or directly) at least 10% of the voting population or an interest equal to that amount if the foreign entity is not incorporated. There are some exceptions to the requirement to file, and most US Expats qualify as an exception.
Most US Expats are exempt from the requirement to file this form. Your exemption status depends on the duration of your stay in a foreign country.
If you were a US Expat living overseas in 2014, you are not required to file the BE-10. There are some expats who only lived overseas for a portion of the year who will be required to file. Not having been overseas for the entire year, though, doesn’t necessarily mean that you will be required to file. It depends on whether or not you were under the jurisdiction of the United States.
To determine the country in which you were under jurisdiction, you must take a few facts into consideration. Here are some of the parameters of determining jurisdiction:
●If you were outside of the United States for less than one year, you would be viewed as being under the jurisdiction of the US.
●If you were outside of the United States for more than one year, you are viewed as being under the jurisdiction of your host country.
There are some exceptions to the rules of determining jurisdiction. They are:
●If you were working for a business that is located in the United States and you spent more than a year conducting your business in a foreign country, you are still considered to be under the jurisdiction of the US if you had intentions to relocate to the US once your job assignment was finished.
●If you are an employee of the United States Government and you are working in a foreign territory, you are still considered to be under the jurisdiction of the US – even if you spent more than a year overseas.
I.J. Zemelman, EA is the founder of Taxes for Expats