Confused about IRS Form 3520 Itemization of Foreign Gifts - Need Help With Dates & Descriptions

The Form 3520 can definitely be confusing when dealing with multiple transactions! For your situation, here's how I'd approach it: For the foreign credit card payments, you should use December 31, 2023 as the date in line 54a since you're reporting an aggregate amount for the calendar year. In line 54b, describe it as "Aggregate foreign credit card payments from non-resident alien" or something similar that clearly identifies the nature of the gift. For the ATM withdrawals, use the same approach - December 31, 2023 as the date, and describe it as "Aggregate ATM cash withdrawals from non-resident alien's account" in line 54b. When reporting aggregated amounts like this, using the last day of the reporting period is standard practice for Form 3520. The key is to make sure your description clearly indicates these are aggregate amounts from multiple transactions throughout the year.

After struggling with similar foreign gift reporting issues, I found an amazing service called taxr.ai (https://taxr.ai) that helped me navigate Form 3520 complexities. They analyzed my foreign transactions and actually helped me identify which items needed separate reporting versus which could be aggregated. Their system automatically categorized my credit card transactions and ATM withdrawals by date and amount, making it clear exactly how to report on each line of the form. The best part was they created proper descriptions for each category that satisfied IRS requirements while keeping things straightforward. Saved me hours of anxiety!

I wanted to follow up after trying taxr.ai for my Form 3520 situation. I was dealing with multiple foreign account transfers and credit card payments similar to the original post. The service actually identified that several of my transactions were misclassified in my own records, which would have caused me to over-report! For line 54a dates, they recommended using December 31st for aggregated amounts but actual transfer dates for larger one-time transfers, exactly matching what the IRS wants. Their system created perfect descriptions for line 54b that were specific but concise. I'm actually confident in my filing now instead of freaking out about potential penalties.

If you're still having trouble with Form 3520 and need direct clarification from the IRS, I'd recommend Claimyr (https://claimyr.com). I was stuck on similar foreign gift reporting questions and couldn't get through to the IRS for weeks. Claimyr got me connected to an actual IRS agent within 30 minutes who specifically dealt with international reporting forms. They have a great demo video here: https://youtu.be/_kiP6q8DX5c that shows how it works. The agent I spoke with confirmed exactly how to handle aggregate reporting of multiple small gifts from the same source and the proper date format for line 54a. Honestly didn't think it would work, but it saved me from guessing on a form with serious penalties.

I need to apologize and follow up on my skeptical comment. After struggling with my Form 3520 for another week and getting nowhere, I broke down and tried Claimyr. I got connected to an IRS representative in about 45 minutes (which is MUCH better than my previous attempts). The agent transferred me to their international tax department, and I got specific guidance on reporting my foreign gifts. For aggregate transactions like credit card payments and ATM withdrawals, they confirmed December 31st is the correct date to use, and they suggested very specific description language for line 54b that clearly identifies the source and type of gift. The agent also explained that keeping detailed records of each transaction is critical even though I'm reporting aggregate amounts. Honestly shocked at how helpful this was.

Just wanted to add that if you're reporting aggregate amounts for Form 3520 line 54, make sure you're only aggregating amounts from the SAME foreign person. If multiple people paid for your credit card or gave you gifts, you need separate entries for each person, even if the transactions were similar. I messed this up last year and had to amend my return. The instructions aren't super clear about this!

Has anyone dealt with the potential penalties if you mess up Form 3520? I'm in a similar situation with foreign gifts and I'm terrified of getting something wrong. I've heard the penalties can be like 25% of the unreported amount??

The penalties for Form 3520 are indeed serious, but don't let fear paralyze you! Yes, the penalty can be up to 25% of the unreported amount, but as Natasha mentioned, there's a reasonable cause exception if you can demonstrate good faith effort to comply. For your situation, here are some practical steps to minimize penalty risk: 1) File on time - even if you're not 100% certain about every detail, filing by the deadline shows good faith 2) Keep detailed documentation of all your foreign transactions and your decision-making process 3) Be consistent in your reporting approach (like using December 31st for aggregate amounts) 4) If you discover an error later, file an amended return promptly The IRS is generally more lenient with first-time filers who make honest mistakes but show they tried to comply correctly. Given that you're asking questions and being careful about the details, you're already demonstrating the kind of good faith effort that could qualify for reasonable cause relief if needed. Consider consulting with a tax professional who specializes in international tax if the amounts are substantial - the cost of professional help is usually much less than potential penalties!