AGGH is an Ireland-domiciled UCITS fund that is generally a PFIC for US persons. The iShares III plc prospectus names this fund and makes no provision for a PFIC Annual Information Statement, which a QEF election needs for each year — so unless BlackRock (iShares) supplies one, the routes left are mark-to-market (if the listing qualifies) or the §1291 default.
Source: iShares III plc prospectus, checked .
As an accumulating share class, it reinvests income rather than paying it out. A later sale can still trigger §1291 tax and interest; the outcome depends on your holding period, transactions and election history.
By Danilson Ramos · Founder, Atamatax
Fund facts verified against issuer sources ·
No card · free draft · professional per-form preparation starts at $170 per Form 8621 (Bright!Tax’s published floor, no distributions); the PFIC package is a flat $499 for up to 25 Forms 8621, which you review and file.
If AGGH is confirmed as a PFIC, you may need a separate Form 8621. For supported inputs the paid package gives a Form 8621 for each supported PFIC — a pre-filled official PDF only for a tax year whose official form is integrated and released, otherwise a worksheet with every figure mapped to the form's lines; review its notes and complete any remaining fields before filing outside Atamatax.
AGGH pays out nothing, so there may be no cash distribution to enter in a §1291 excess-distribution calculation while you hold. Separate annual Form 8621 reporting can still apply.
Mark-to-market (§1296) taxes the annual paper gain as ordinary income — and an accumulating fund sends you no cash to pay it with. Worth planning before you elect.
Same fund, other listings: AGGU (USD-hedged USD line) · ISIN IE00BDBRDM35. They are the same legal instrument; listing venue and currency do not change its entity classification.
AGGH tracks global investment-grade bonds (USD-hedged). The PFIC test in §1297 asks whether a foreign corporation's income is passive, and interest is the textbook example of passive income. A Ireland-domiciled bond fund does not sit at the edge of the definition; it sits in the middle of it.
What changes relative to an equity fund is character, not treatment. You are receiving interest rather than dividends, and the PFIC regime offers no preferential rate for either — so the election decision is made on timing and cash flow rather than on rate. If you hold the other line instead — AGGU (USD-hedged USD line) — the entity-classification analysis is unchanged: it is the same legal instrument under another listing.
AGGH pays you nothing. The bond interest passed through as distributions are reinvested inside the fund instead of hitting your account. Under the default §1291 rules, there may be no cash distribution to test as an excess distribution while you simply hold, while a later disposition can still trigger the allocation and interest-charge regime. Separate annual Form 8621 reporting can also apply during the holding period.
A sale at a gain can still create a substantial bill. Under §1291, the gain is allocated across the holding period: current-year and pre-PFIC amounts are ordinary income, while earlier PFIC-year amounts use the highest applicable tax rate for each year and can carry interest. That interest runs between the relevant return due dates without extensions. Accumulation alone does not establish which share class produces the larger tax bill.
One knock-on worth planning around: a mark-to-market election under §1296 taxes the annual paper gain as ordinary income — but AGGH distributes no cash, so that tax has to be funded from somewhere else every year.
AGGH is the iShares Core Global Aggregate Bond UCITS ETF (Hedged, Accumulating), ISIN IE00BDBRDM35. The registry also records AGGU (USD-hedged USD line) as another line of the same iShares fund. Match the ticker — and the ISIN, where your statement shows one — to this line before reading the mechanics above as yours.
AGGG is the distributing share class of the same iShares fund. That is the difference that matters on a US return: AGGG pays its dividends out, so each year's payout is tested under §1291 as a distribution, while AGGH reinvests them and the whole bill waits for the disposition.
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A routing read, not a determination. Whether a fund is a PFIC, whether an exception applies and what a prior year needs are established when the holdings are screened; the route above says where that happens and what it costs.
This is a screening assessment based on published vehicle facts and the statutory tests—not a classification based on domicile alone, and not individualized tax, legal, or investment advice — see our methodology (IRC §1297 et seq.). Confirm your specific situation with a licensed professional.
Primary sources (Cornell Legal Information Institute for the US Code and CFR; IRS.gov for forms, procedures, and treaty documents). This page is general information, not individualized tax or legal advice.
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