# Reporting Question: % in non-US limited partnership company holding % of non-US limited company



## pinecrest515 (8 mo ago)

Question for US expat tax experts here, on a hypothetical situation:

Hypothetically, suppose that you are a US person (citizen or green card) who has a percentage equity interest, say 6%, in a non-US limited company A. For year one, you may depending on threshold situation file FACTA Form 8398 with this equity as a foreign asset from non-US company A. This bit is clear.

Then, at the start of year two, suppose your equity gets moved to a new non-US foreign limited partnership company B, whose formation fills the purpose of acting as a holding for parts of non-US company A's equity. The non-US limited partnership company B holds your 6% of non-US limited company A along with equity of another US person who owns 4% of non-US limited company A, so together the non-US limited partnership company B would be US-controlled and hold 10% of non-US limited company A. In other words, 10% of non-US limited company A is owned by non-US limited partnership company B, of which you hold 60%.

Questions:
1) Hence, for year two, it's assumed that you would need to file Form 8865 Foreign Partnerships, right?
2) In this case, for year two, supposed threshold is met, how would FACTA Form 8398 be addressed? Would reporting of the foreign limited partnership company B suffice, since the equity in foreign limited partnership company B holds the equity stake in foreign limited company A? Or do you need to make a separate entry for foreign limited company A? (but wouldn't that be double counting?)

Thanks in advance if anyone has encountered similar instances or has insights on this.


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