# Form 8854 Questions Section B Balance Sheet - Q1 Property Net Worth - current value or capital gains



## AV56 (Oct 14, 2021)

I have a few questions about completing the Net Worth balance statement (Section B) for Form 8854, specifically to determine if I am a covered expat due to reaching the 2M threshold. I'll break these into separate posts. 

If it helps - born USA, became dual Canadian citizen at age 18, lived solely in Canada since them. Renounced my US citizenship in 2021. Now working on completing my form 8854 to determine if I am an uncovered or covered expat (which means I would be subject to exit tax).

For marketable stocks, securities (both foreign & US) and for property located outside the US. For the purpose of calculating net worth (line 25), are the values of this items their current value (as of the day prior to renouncing) or just the gain in value (=Current value - cost of the stock/property). 

For example if I own a stock that has a current value of $150 but I purchased it for $100 - for the purposes of calculating net worth do I report $150 (current value) or $50 (the gain in value since purchase)?

Thank you. This will have a big impact on calculating net worth.


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## Bevdeforges (Nov 16, 2007)

AV56 said:


> For the purpose of calculating net worth (line 25), are the values of this items their current value (as of the day prior to renouncing) or just the gain in value (=Current value - cost of the stock/property).


For the balance sheet section, the valuation of all assets is the fair market value of the asset as of the date demanded in the instructions. (I thought it was as of the date of renunciation, but if the instructions say the day before that, then that's the date to use.)


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## AV56 (Oct 14, 2021)

Bevdeforges said:


> For the balance sheet section, the valuation of all assets is the fair market value of the asset as of the date demanded in the instructions. (I thought it was as of the date of renunciation, but if the instructions say the day before that, then that's the date to use.)


Thank you. Where does the cost basis fit in (essentially the difference between current cost & purchase price) as well as the exclusion amount (the value of which adjusts annually for inflation, which was $725,000 in 2019)? Is this not factored in until the amount of exit tax payable is calculated?


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