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Question, I am the beneficiary of death benefits for a relative working aboard who was a US citizen. Do I have to file a form 3520 or any other forms since the funds are sent to me from overseas. Any insight and how to best file taxes regarding this?
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It depends. You will need to file a form 3520 if the inheritance is over $100,000 and if your relative:
The good news it is an informational form and not an actual tax form. It is usually not considered a taxable event unless there was interest that may have accrued if it was housed in a foreign trust or account.
If you aren't sure of the status of your relative, it may be safe to file form 3520 as a precaution. Please review this IRS instructional link for more information regarding filling out form 3520.
[ Edited 12/29/21|03:00 PM PST]
Thanks!, Relative was a us citizen and filed US taxes yearly and the death benefits is over 100k USD. Regarding if it was in a trust, I'm not sure. Either way, seems the best course of action is to file the 3520.
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