I got a 150k as a gift from a family member (Nonresident Aliens) to purchase a property and after the purchase, I returned the excess amount (40k). The two transactions are 4 months apart but both in 2021.
What should be reported on form 3520? Should I include the difference or the full amount? Also, if I would put the full amount, does that mean I have to file another form for giving the money back as a gift?
Form 3520 is a form that needs to be completed and mailed in. You can still complete your regular tax filing with TurboTax.
Form 3520 is a disclosure document, and there is never any actual tax due with it.
Since you returned 40K, you could report a gift of 110K on Form 3520. You don't have to file another form.
Click this link for more info on Form 3520.
Thanks for replying,
But how it would be reported? The form is asking for each gift item above 5k to be individually reported. So would I put one line at 150k with the date and another line -40k? I'm worried that if I put only 120k it wouldn't match the bank transfer (or the requirement to identify each gift individually) and it raises an issue.