3520 filing date and cost basis for depreciation - foreign inherited property

[Rsvp2024]

Hello experts have a few questions and looking for guidance. 

Y2023

Mother died leaving her rental property without a registered will 

My siblings agreed to settle the property to me and started the registration process

I started collecting rent in my account.

Y2024

Property officially registered in my name..it was a long process overseas. 

Question 

1. Is 3520 due the year (2023) when she died or when the property was officially registered to me (2024)

2. In 3520 do I report the FMV on her death date or the date when the sibling settlement was registered?  Is this the cost basis for depreciation calculation? 

3. I am reporting the rental income in 2023 as I was receiving it in my account even though the official property transfer occurred only in 2024. Is that fine?

[pk · Accepted solution]

@Rsvp2024 , while it may not be that important, I would :

(a) file form 3520 for the year 2023  -- because  it is effectively a beneficial ownership , you collected rent, behaved as if it is yours  and lastly your siblings ( other inheritors behaved as if it is yours ).  Note that TurboTax does not support  form 3520 --- please download from   www.irs.gov, fill, sign, date and mail-in to address shown on the instructions.

(b)  Note that the your basis in the property ( by inheritance ) is the FMV of the asset on the  date of passing of the decedent.

(c)  You will need to recognize the  income nature of the property  by filing schedule-E and depreciation based on the Asset value ( non-land portion) -- depreciable value.

(d) if you own or have signature authority over any foreign accounts  you do come under  FBAR ( form 114 at FinCen.gov, only on-line filing ) and FATCA regs.

Is there more I can do for you ?

[Rsvp2024]

@pk Thank you for the prompt response and for the detailed answers. 

Hypothetically speaking, if I filed 3520 in 2024, would the date of bequest be mom's date of death in 2023 or the sibling settlement date in 2024?

Truly appreciate your service to this community. 

[pk · Accepted solution]

@Rsvp2024 , valuation  at Mom's death but 3520 date would be the settlement date  .

Does this make sense ?

[Rsvp2024]

Yes, makes sense. Thanks again !