I need to file form 3520 this year, can I still use turbotax this year? If I can How could I file form 3520?

[GeoffreyG · Accepted solution]

If you have to file Form 3520 this year (Annual Return to Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts), you can do that manually, by downloading the tax form itself and the instructions at the following internet links:

https://www.irs.gov/pub/irs-pdf/f3520.pdf

https://www.irs.gov/pub/irs-pdf/i3520.pdf

You can then use TurboTax to complete your tax return normally if you wish.  While Form 3520 must be printed and paper filed, by mail (it cannot be e-filed), there is no reason that this should interfere with your regular income tax return preparation and filing.  Form 3520 is a disclosure document, really, and there is never any actual tax due with it.

However, if you meet the conditions of having to file Form 3250 (receipt of more than $100,000 in value from a foreign source), then failure to file it can lead to a fine of up to 5% per month (maximum of 25%) of the amount received.

Form 3520 does not come as part of the TurboTax software package; but for that matter neither does it come with the consumer software offerings of any of our worthy competitors.  But, fortunately, the form is easy enough to fill out by hand.  Also, hiring a professional local tax preparer to do it for you is an option as well.  You can still use TurboTax to complete your personal income tax return.  The two things are really separate activities that need not interfere with each other.

Thank you for asking this question.

[jimtbred]

It's now November 2018 and the IRS still only has the 2017 Form 3520 available. Unless the IRS makes the 2018 form available soon, it will be impossible to meet the deadline of submitting the appropriate form in the current calendar year as required by IRS. Catch 22.

[jimtbred]

It's now November 2018 and the IRS still only has the 2017 Form 3520 available. Unless the IRS makes the 2018 form available soon, it will be impossible to meet the deadline of submitting the appropriate form in the current calendar year as required by IRS. Catch 22.

[VolvoGirl]

See the instructions.  Very top first thing it says NEW DUE DATE
<a rel="nofollow" target="_blank" href="https://www.irs.gov/pub/irs-prior/i3520--2017.pdf">https://www.irs.gov/pub/irs-prior/i3520--2017.pdf...>

[jimtbred]

Perfect. Thank you.

[franlai]

GeoffreyG, Did you have a typo in "However, if you meet the conditions of having to file Form 3250"? You mean Form 3520?

[kk11]

Can you please help me? I have a questions regarding when exactly do I need to file Form 3520. Let's say you got some gift in Jan 2020, are you supposed to file 3520 before April 15, 2020 or April 15 2021?

Thanks in advance for your help!

[sharong81]

the reply only answered part of the question.  Since 3250 is done manually and mailed does ones whole return need to be printed and mailed .  Or can you efile the 1040 and send the 3250 separately. thank you

[euiihgfihw]

I have the same question as sharong81.  In fact, in the  "Miscellaneous Investment Income" section of TurboTax,  in addition to advising one to file an FBAR electronically,  there is a "Foreign Financial Assets Already Reported" screen, where you can check if you are going to file a form such as Form 3520. It says "These forms are not included in TurboTax. They must be obtained from the IRS, completed manually, and mailed in with your return." 

The fact that it advises to mail it in with the return, leads me to believe that I can't eFile the part of my return that TurboTax was able to capture. Rather, I'll need to print it and mail everything TurboTax captured and also mail the form 3520 along with it. I'd gladly find out if this i not the case though.

[IH22]

In your post in June 2019, you state that you are only required to file a Form 3520 if you receive more than $100,000 from a foreign trust.  Can you confirm that? Can you point me to a reference in the IRS documentation that supports that as I can't find one.

Thanks.

[RobertB4444]

The $100,000 number is correct.  There are a number of reasons that someone could be required to file a form 3520 - most of which involve foreign trust activity - but the threshold which requires filing it for a US person receiving a gift from a foreign source is indeed $100,000.  Here are the instructions for form 3520.  (They are from 2021 but the instructions haven't been updated for 2022 yet - keep an eye out for that).  Look in the second column of the first page under number 4 for the details.

@IH22

[pk]

@IH22 , agreeing with @RobertB4444  on US$100,000 being the threshold for  filing requirement of form 3520 receiving  cash/ liquid asset from  a foreign person / estate/ trust  by a US person ( citizen/GreenCard / Resident for tax purposes ).  Additionally  you may also have to file  form 8938 along with your return if the monies rested  in a foreign account  owned / operated by you  or you have signature authority over ( nominee account holder ).  You also may come under FBAR rules.

There is no filing requirement for the Non-Resident person/entity of the other side of the transaction.

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