form 3520

[chenchengu2018]

We received gift money 120k from foreign family members 2017. But later we have to pay back this money as a non-interest loan in next 10 years. In that case, do we need to file 3520 to report this money? Thanks.

[PaulaM]

This is what the IRS says on the reporting requirements:

Reporting Requirements
You must file Form 3520, Annual Return to Report Transactions with Foreign Trusts and Receipt of Certain Foreign Gifts, if, during the current tax year, you treat the receipt of money or other property above certain amounts as a foreign gift or bequest.  Include on Form 3520:

• Gifts or bequests valued at more than $100,000 from a nonresident alien individual or foreign estate (including foreign persons related to that nonresident alien individual or foreign estate);

or

• Gifts valued at more than $15,601 for 2015 (adjusted annually for inflation) from foreign corporations or foreign partnerships (including foreign persons related to the foreign corporations or foreign partnerships). 

Gifts from Foreign Person

While you may not be required to file the form 3520, it can be in your best interest to do so. The amount alone may have the IRS giving it more scrutiny and this way, you have been completely transparent by reporting it.  

[chenchengu2018]

Thank you for the reply.

Sorry, I didn't mention it clearly. "Gift" means zero interest in this case (since the loaner is close to us and they're willing to lend money to us with zero interest as a gift), but it's a loan essentially. Do I need to file form 3520 if it's a loan?

[kk11]

I have a related question, when exactly should you file? Let's say you receive the money in Jan 2020. Should you file it as soon as possible? Do you need to file it before April 15, 2020 or April 15, 2021? 

Thanks in advance for your help!

[DoninGA]

It really does not matter, as long as the IRS receives the form on or before 04/15/2021.