Gift from Foreign Persons. Form 3520

[flyday2022]

Hello! I have a question about From 3520.

My parents are non-resident alien individuals and sent gifts to my child's 529 college saving account (account beneficiary is my child) this year. My father gifted 50K and my mother gifted 60K to the 529 account, which adds to 110k. The gifts are sent with multiple checks across several months, each check amount ranges between 3k to 25k. I understand I need to file form 3520 Part IV on behalf of my child for year 2025. The part IV in 3520 have 3 rows of space, I plan to fill the form like below: For row 1, Description of property received: Gift from grandfather to the 529 college saving account, total 50K; For row 2, Description of property received: Gift from grandmother to the 529 college saving account, total 60K.  Please advise if this is ok to put the total amount from each person like this? Or do i have to list every single check in different rows, even if checks are from same person? If it is ok to put the total amount from each person in one row, what is the Date of gift I may put in? Will it be the the first check receive date or the last check receive date? Thanks!  

[pk · Accepted solution]

@flyday2022 , 

IRC Section 529(c).2 says;

(2)Gift tax treatment of contributionsFor purposes of chapters 12 and 13—

(A)In generalAny contribution to a qualified tuition program on behalf of any designated beneficiary—

(i)

shall be treated as a completed gift to such beneficiary which is not a future interest in property, and

(ii)

shall not be treated as a qualified transfer under section 2503(e).

Thus contributions to the 529 plan by the NRA grand-parents are indeed gifts to the beneficiary.  Therefore the reporting threshold of US$100,000 or more does  trigger a reporting of form 3520 for and on-behalf of the minor beneficiary ( in your case ).

Now to your specific questions:

Page 1 --  check Box -- your are an individual

Line 1a  thru 1h filled with the details of the 529 beneficiary 

Part IV, line 54 ---, check the box  YES;   since the transfers dates and amounts were spread over the year, I would put  the date when  the final amount was received  from each of the Grandparents  ---- e.g.   10/22/2024  ----Grand Father  ( NAME )   Cash gift to 529 Plan  ---- 60,000.

Last Page -- sign and date   ( Note you are filing for the child beneficiary ).

Is there more I can do for you ?

[flyday2022]

Thanks very much @pk !

I do have a follow up question. The space in the row at the 3520 form is limited so I cannot put too many words. In the Description, may I just put "Gift from grandparent (non-resident alien individual) to 529 college saving plan of child name", or do I must also include the full name of each grandparent in each row?   

Thanks for the advice!

[pk]

@flyday2022 , yes  the space is a bit small .  So , IMHO, you need to put in barest info --- Person's name ( NRA)  and for what --" beneficiary 529  contribution".  I say this because  this is a record of who received the amount and from whom, while 529 ref. is to show that this goes to an account.  I don't know if the IRS keeps detailed track of this or not , but for your own protection you are declaring this gift by NRA  ( two related persons ) to a non-taxable / tax favored account of the beneficiary.  Thus this becomes your record.

BWT -- I am assuming here that  neither the donors  nor the country where  they are resident/citizen of  are sanctioned  .

Is there more I can do for you ?

[flyday2022]

got it, thanks very much!