IRS Form 8966 – FATCA Report

IRS Form 8966 – FATCA Report – In today’s global economy, tax compliance extends beyond borders, especially for financial institutions and entities dealing with U.S. accounts. IRS Form 8966, also known as the FATCA Report, plays a crucial role in ensuring transparency and preventing tax evasion. Whether you’re a foreign financial institution (FFI), a withholding agent, or a direct reporting non-financial foreign entity (NFFE), understanding how to file Form 8966 is essential for maintaining compliance. This guide covers everything you need to know about IRS Form 8966, including its purpose, filing requirements, deadlines, and more, based on the latest IRS guidelines for tax year 2025 (filed in 2026).

What Is FATCA and Why Does It Matter?

The Foreign Account Tax Compliance Act (FATCA), enacted in 2010, requires foreign financial institutions to report information about U.S. account holders to the IRS. This helps combat offshore tax evasion by U.S. taxpayers. FATCA mandates that participating FFIs (PFFIs) and other entities disclose details on U.S. accounts, substantial U.S. owners of passive NFFEs, and certain other holdings. Non-compliance can result in withholding taxes on U.S.-sourced payments, making FATCA adherence critical for international finance.

FATCA operates through intergovernmental agreements (IGAs), such as Model 1 and Model 2, which dictate reporting channels. Under Model 1 IGAs, FFIs report to their local tax authorities, while Model 2 requires direct reporting to the IRS via Form 8966. As of 2026, FATCA remains a cornerstone of U.S. tax policy, with no major recent developments noted by the IRS.

What Is IRS Form 8966? Purpose and Overview

IRS Form 8966 is the official FATCA Report used to disclose information about U.S. accounts and related entities. It reports details on:

  • U.S. accounts maintained by PFFIs.
  • Substantial U.S. owners of passive NFFEs.
  • Specified U.S. persons owning certain debt or equity interests in owner-documented FFIs (ODFFIs).
  • Other accounts based on the filer’s chapter 4 status under the Internal Revenue Code (sections 1471–1474).

The form ensures the IRS receives accurate data on foreign assets held by U.S. persons. A separate Form 8966 must be filed for each substantial U.S. owner or specified U.S. person, and for pooled reporting groups. The form’s structure includes parts for filer identification, account holder information, owner details, financial data, and pooled reporting.

You can download the latest PDF version of Form 8966 directly from the IRS website: https://www.irs.gov/pub/irs-pdf/f8966.pdf. For the 2025 tax year, the form was released on December 19, 2025.

Who Must File Form 8966?

Not everyone needs to file Form 8966—it’s primarily for entities under FATCA obligations. Key filers include:

  • Participating FFIs (PFFIs), including Reporting Model 2 FFIs.
  • Registered Deemed-Compliant FFIs (RDCFFIs).
  • Direct Reporting NFFEs and Sponsored Direct Reporting NFFEs.
  • Sponsoring Entities, Trustees of Trustee-Documented Trusts.
  • Withholding Agents, including U.S. branches treated as U.S. persons.
  • Territory Financial Institutions (FIs) treated as U.S. persons.

Reporting Model 1 FFIs typically report to their host country’s tax authority, not directly to the IRS. Filers must report accounts maintained during the calendar year, including those closed or transferred (with exceptions for rollovers within the same FFI). Accounts under $50,000 or certain retirement accounts may be exempt unless the filer elects otherwise.

How to File IRS Form 8966: Step-by-Step Guide?

Filing Form 8966 can be done electronically or on paper, but electronic filing is required for financial institutions regardless of the number of forms. Here’s how:

  1. Gather Required Information: Include Global Intermediary Identification Number (GIIN), Taxpayer Identification Number (TIN), account details, financial data (e.g., balances, interest, dividends), and owner information.
  2. Complete the Form Sections:
    • Part I: Filer identification (name, address, category code, GIIN/TIN).
    • Part II: Account holder or payee info (name, address, TIN, type).
    • Part III: Owner information for passive NFFEs or ODFFIs.
    • Part IV: Financial details (account number, balance, payments in U.S. dollars or original currency).
    • Part V: Pooled reporting for recalcitrant or non-consenting accounts (number of accounts, aggregate balance).
  3. Electronic Filing: Use the International Data Exchange Service (IDES). Refer to Publication 5124 for XML schema details (version 2.0 required since 2017). Waivers for electronic filing are available via Form 8508-I, submitted 45 days in advance.
  4. Paper Filing: Mail to IRS, FATCA, Stop 6052 AUSC, 3651 South IH 35, Austin, TX 78741, using Form 8966-C as a cover sheet.
  5. Corrections and Amendments: File corrected, amended, or voided reports as needed, matching the original format and using the same unique identifier.

For XML schemas and business rules, check the IRS’s dedicated page, last updated October 7, 2025.

Filing Deadlines for Form 8966

The due date for Form 8966 is March 31 following the calendar year being reported (e.g., March 31, 2026, for tax year 2025). An automatic 90-day extension is available via Form 8809-I. A second 90-day extension may be granted for hardship. Note: No extensions for non-consenting U.S. accounts under Model 2 IGAs.

Penalties for Non-Compliance with FATCA Reporting

Failure to file Form 8966 accurately and on time can lead to penalties under chapter 4 rules. While specific amounts aren’t detailed here, non-compliance may trigger 30% withholding on U.S.-sourced payments to the entity. Always consult IRS Publication 5190 or a tax professional for penalty details.

  • Form 1042: Annual Withholding Tax Return for U.S. Source Income of Foreign Persons.
  • Form 1042-S: Foreign Person’s U.S. Source Income Subject to Withholding.
  • Form 8809-I: Extension request.
  • Publication 5124: FATCA XML Schema User Guide.

For more FATCA resources, visit IRS.gov/FATCA.

FAQs About IRS Form 8966 and FATCA Reporting

1. What if my entity has no reportable accounts?

Direct Reporting NFFEs or Sponsoring Entities can file a nil report by checking the appropriate box and completing only Part I.

2. Can I report in a currency other than USD?

Yes, use the account’s currency with ISO 4217 codes, or convert to USD per regulations.

3. Are there updates for 2026 filings?

As of January 23, 2026, there are no recent developments for Form 8966. Check IRS.gov for any changes.

4. How do I handle pooled reporting?

Use Part V for recalcitrant or non-consenting accounts, reporting aggregate numbers and balances by category.

Conclusion: Stay Compliant with FATCA in 2026

Mastering IRS Form 8966 is key to FATCA compliance, helping avoid penalties and ensuring smooth international operations. By using trusted IRS resources and filing on time, entities can meet their obligations efficiently. If you’re unsure about your filing status, consult a tax advisor. Download Form 8966 today and get started on your 2025 reporting.