Yes—if your combined year-end PFIC value is $50,000 or less and you had no disqualifying transaction or election, you do not file separate Forms 8621 merely because you own more than 10 funds.
“I am filing jointly with my wife and have over 10 Indian mutual funds totaling less than $50,000. Do these qualify for the de minimis exception for Form 8621, or do I have to file a separate form for each one?”
Summary
Owning more than 10 funds does not itself create 10 filing obligations. If only one or two funds have a transaction or election trigger, you may need forms only for those funds while the qualifying held-only funds remain within the exception.
Your result depends on the combined year-end value and whether any individual fund had a reporting transaction or election—not on owning more than 10 funds.
If the combined last-day value of all counted stock owned by you and your wife was $50,000 or less, each affected investment is under the default section 1291 rules, and the fund had no , disposition gain, or separate election/reporting trigger, section 1298(f) does not require Form 8621 merely for annual reporting [26 CFR 1.1298-1(c)(2)(i), (iii)]. You can therefore have zero Forms 8621 despite owning more than 10 funds.
If a fund had an excess distribution, disposition gain, , section 1296 mark-to-market reporting, or another Part II election, file Form 8621 for that affected PFIC. If the correctly calculated combined year-end value exceeds $50,000, the annual-reporting exception also fails [Instructions for Form 8621, “Who Must File”; 26 CFR 1.1298-1(c)(2)].
One Form 8621 cannot cover multiple PFICs: when filing is required, a separate form is required for each PFIC. You and your wife may, however, use one joint Form 8621 for the same PFIC even if one or both of you own it [26 CFR 1.1298-1(e); Instructions for Form 8621].
First confirm that each investment is a foreign corporation meeting the PFIC income or asset test; Form 8621 does not apply to an investment that is not a PFIC.
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Next steps
Follow these steps to determine whether you need zero, one, or several Forms 8621.
Before counting values
List and classify every fund
Determine whether each fund is a foreign corporation meeting either the 75% passive-income test or the 50% passive-asset test [Instructions for Form 8621, “Passive Foreign Investment Company”]. Treat each distinct PFIC issuer separately rather than treating the brokerage or mutual-fund account as one PFIC.
Requirements
Apply the $50,000 test
Add the joint year-end values
Add the last-day value of all PFIC stock counted under 26 CFR 1.1298-1(c)(2), for both spouses—not only the 10 Indian funds. If the result is $50,000 or less, continue to the transaction test; if it is more, the joint de minimis annual-reporting exception does not apply.
Requirements
Fund by fund
Test each fund for a filing trigger
For each fund, identify any excess distribution, recognized disposition gain, QEF or section 1296 reporting, or Part II election [26 CFR 1.1298-1(c)(2)(i); Instructions for Form 8621, “Who Must File”]. A qualifying held-only section 1291 fund needs no Form 8621 solely for annual reporting; a triggered fund does.
Requirements
With your federal return
Attach each required Form 8621
Use the current form at https://www.irs.gov/pub/irs-pdf/f8621.pdf and instructions at https://www.irs.gov/pub/irs-pdf/i8621.pdf. Attach each required form to your joint return and file it by the return’s due date, including extensions; you and your wife may use one joint form for the same PFIC [26 CFR 1.1298-1(e); Instructions for Form 8621, “When and Where To File”].
Requirements
Do not use the $50,000 PFIC threshold
Apply the separate foreign-reporting tests
File FinCEN Form 114 if aggregate foreign financial accounts exceeded $10,000 at any time. For calendar year 2025, the automatic extended deadline is October 15, 2026. Also apply the applicable Form 8938 joint threshold—$100,000/$150,000 if living in the United States or $400,000/$600,000 if qualifying as living abroad [IRS FBAR page; Instructions for Form 8938].
Requirements
Legal sources
This answer is based on Treasury regulation 26 CFR 1.1298-1, the December 2025 IRS Form 8621 instructions, and official IRS and FinCEN foreign-asset reporting guidance.
26 CFR 1.1298-1
The threshold is based on both spouses’ combined counted PFIC holdings at year-end, not the number of funds.
(c)(2)(iii)
In the case of a joint return, the exception described in paragraph (c)(2)(i)(A)(1) of this section shall apply if the value of all PFIC stock owned directly or indirectly (as determined under section 1298(a), § 1.1291-1(b)(8), and paragraph (c)(2)(ii) of this section) by both spouses is $50,000 or less, and all of the other applicable requirements of paragraph (c)(2) of this section are met.
26 CFR 1.1298-1
An excess distribution, covered disposition gain, or QEF election prevents this fund from using the annual-reporting exception.
(c)(2)(i)(B)–(C)
(B) The shareholder is not treated as receiving an excess distribution (within the meaning of section 1291(b)) with respect to the section 1291 fund during the taxable year or as recognizing gain treated as an excess distribution under section 1291(a)(2) as the result of a disposition of the section 1291 fund during the taxable year; and (C) An election under section 1295 has not been made to treat the section 1291 fund as a qualified electing fund with respect to the shareholder.
26 CFR 1.1298-1
Required reporting is per PFIC, although joint filers can share one form for the same PFIC.
(e)(1)–(2)
If a United States person is required under section 1298(f) and these regulations to file Form 8621 (or successor form) with respect to more than one PFIC, the United States person must file a separate Form 8621 (or successor form) for each PFIC. United States persons that file a joint return may file a single Form 8621 (or successor form) with respect to a PFIC in which they jointly or individually own an interest.
Instructions for Form 8621
The IRS instructions confirm the per-PFIC rule and explain how and when to submit required forms.
Who Must File; When and Where To File
A separate Form 8621 must be filed for each PFIC in which stock is held directly or indirectly. Attach Form 8621 to the shareholder's tax return (or, if applicable, partnership or exempt organization return) and file both by the due date, including extensions, of the return at the Internal Revenue Service Center where the tax return is required to be filed.
Instructions for Form 8621
An Indian investment is not automatically a PFIC merely because it is foreign; its U.S. classification and income or asset test control.
Passive Foreign Investment Company (PFIC)
A foreign corporation is a PFIC if it meets either the income or asset test described next. 1. Income test. 75% or more of the corporation's gross income for its tax year is passive income (as defined in section 1297(b)). 2. Asset test. At least 50% of the average percentage of assets (determined under section 1297(e)) held by the foreign corporation during the tax year are assets that produce passive income or that are held for the production of passive income.
Instructions for Form 8621
This defines the type of distribution that defeats the small-holder exception for a default section 1291 fund.
Excess distributions
An excess distribution is the part of the distribution received from a section 1291 fund in the current tax year that is greater than 125% of the average distributions received in respect of such stock by the shareholder during the 3 preceding tax years (or, if shorter, the portion of the shareholder's holding period before the current tax year). No part of a distribution received or deemed received during the first tax year of the shareholder's holding period of the stock will be treated as an excess distribution.
FinCEN Form 114 (FBAR)
Foreign mutual funds can create an FBAR obligation even when Form 8621’s $50,000 exception applies.
Who must file
Per the Bank Secrecy Act, every year you must report certain foreign financial accounts, such as bank accounts, brokerage accounts and mutual funds, to the Treasury Department and keep certain records of those accounts. the aggregate value of those foreign financial accounts exceeded $10,000 at any time during the calendar year reported.
FinCEN Form 114 (FBAR)
An FBAR ordinarily due April 15 receives an automatic extension through October 15.
When to file
The FBAR is an annual report, due April 15 following the calendar year reported. You’re allowed an automatic extension to October 15 if you fail to meet the FBAR annual due date of April 15. You don’t need to request an extension to file the FBAR.
Instructions for Form 8938
Form 8938 has separate joint-filer thresholds depending on whether the taxpayers live in or outside the United States.
Reporting Thresholds Applying to Specified Individuals
If you are married and you and your spouse file a joint income tax return, you satisfy the reporting threshold only if the total value of your specified foreign financial assets is more than $100,000 on the last day of the tax year or more than $150,000 at any time during the tax year. If you are married and you and your spouse file a joint income tax return, you satisfy the reporting threshold only if the total value of your specified foreign financial assets is more than $400,000 on the last day of the tax year or more than $600,000 at any time during the tax year.
Instructions for Form 8938
Assets reported on Form 8621 still count when testing the Form 8938 filing threshold.
Valuing specified foreign financial assets
If you are a specified individual, you must include the value of the assets reported on Forms 3520, 3520-A, 5471, 8621, and 8865 in determining whether you satisfy the reporting threshold that applies to you.
These are the official rules as published on the cited dates; tax rules and form instructions can change.
This is general information about official processes, not legal advice; SettleKit is not a law firm.
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