The IRS has issued proposed and temporary regulations and a new information reporting form that must be used to report specified foreign financial assets for tax year 2011.

Form 8938, Statement of Specified Foreign Financial Assets, must be filed by taxpayers with specific types and amounts of foreign financial assets or foreign accounts.

The form is required when the total value of specified foreign assets exceeds certain thresholds. For example, a married couple living in the United States and filing a joint tax return must file the form if the amount of their total specified foreign assets exceeds $100,000 on Dec. 31, 2011, or was more than $150,000 at any time during 2011.

The thresholds for U.S. taxpayers who reside abroad are higher. For example, a married couple residing abroad and filing a joint return would not file Form 8938 unless the value of specified foreign assets exceeds $400,000 on Dec. 31, 2011, or more than $600,000 at any time during 2011.

The instructions for Form 8938 explain what the reporting thresholds are, what constitutes a specified foreign financial asset, how to determine the total value of relevant assets, what assets are exempted and what information must be provided.

The new filing requirement does not replace or otherwise affect a taxpayer’s obligation to file an FBAR (Report of Foreign Bank and Financial Accounts).

Failure to file Form 8938 when required could result in a $10,000 penalty, with an additional penalty up to $50,000 for continued failure to file after IRS notification. The IRS can also impose a 40 percent penalty on any understatement of tax attributable to nondisclosed assets.

Special statute of limitation rules apply to Form 8938. They are also explained in the instructions.

Read more in the instructions to Form 8938.