Foreign Rental Property - 8858

[MJ Sally]

I'm confused about Form 8858. In my research, I found conflicting information—some sources say I need to file it, while others say I don’t. Given the information below, do I still need to file Form 8858?

1. The property was previously my home, but I now rent it out.

2. I haven’t set up a business or LLC, nor do I have a property manager. It’s purely passive income, with the tenant paying me directly via ACH.

3. I don’t keep a spreadsheet or track it as a business—I just ensure the tenant pays each month.

4. I also spend very little time managing it.

5. The property is in my name.

[SabrinaD2]

Based on the information you provided, it does not appear you need to file Form 8858. This form is required for U.S. persons who own a Foreign Disregarded Entity (FDE) or operate a Foreign Branch (FB) directly or indirectly

• Since your rental property is in your name and you haven't set up a foreign business or LLC, you don't meet the criteria for filing Form 8858. 
• To file Form 8858, you would need to own a Foreign Disregarded Entity (FDE), which is an entity not created or organized in the United States and is disregarded as separate from its owner for U.S. income tax purposes.
• However, you do need to file:
  • Form 1040: Report your rental income on Schedule E, including income, expenses, and depreciation
  • FBAR (Foreign Bank Account Report): If you have foreign bank accounts with more than $10,000 at any point during the year