For U.S. investors, a company like Metaplanet raises a critical tax consideration: Could these companies be classified as Passive Foreign Investment Companies (PFICs)? If so, owning shares could trigger complicated tax implications and requires filing Form 8621.
In this article, we’ll break down:
The PFIC income and asset tests.
How PFIC holdings in HSAs or retirement vehicles still (potentially) complicate matters.
What Metaplanet’s CEO, Simon Gerovich, has disclosed about their PFIC evaluation as recently as this summer.
Things to continue to watch for as Bitcoiners interested in Bitcoin treasury companies.
Over the summer, the Japanese Bitcoin treasury company, Metaplanet, received some criticism as potentially being classified as a PFIC under U.S. tax law. In response, Metaplanet’s CEO, Simon Gerovich, has publicly acknowledged their attention to PFIC rules for U.S. shareholders. In a post on X, he stated:
“We will be qualified as a PFIC for a given taxable year if 75 percent or more of our income for such taxable year is passive income.”
Several weeks later, Metaplanet concluded its own analysis of the PFIC status question and produced a formal announcement on its PFIC status for the year 2025. In that announcement, the company said:
“Based on our current structure, operations, and the nature of our income and assets, we have concluded, in consultation with our advisors, that Metaplanet is not expected to be classified as a PFIC for the 2025 taxable year. We also do not expect to become a PFIC in future taxable years, assuming continued adherence to our current structure and business mode.”
In coming to this conclusion, Metaplanet noted that:
They engaged U.S. legal and tax advisors to assess their PFIC status.
Per IRS definitions, a PFIC classification applies if the income or assets thresholds are met.
Metaplanet asserts that a significant portion of its revenue should qualify as active, potentially helping to avoid PFIC status. That said, the announcement also noted that “no assurance can be given that the U.S. Internal Revenue Service will agree with this conclusion or that future changes in our operations, asset composition, or applicable tax law will not alter this assessment.” In other words, although Metaplanet did its due diligence on behalf of shareholders, that doesn’t mean the IRS will necessarily agree and the final word lies with them. Investors were also encouraged in the company’s announcement to seek out their own legal and tax advice as well.