Form 3520 Filing Questions for Foreign Gift Real Estate Over $100,000 - Need Help!
I recently found out I might need to file Form 3520 for reporting a foreign gift and I'm completely lost with several questions about this process. First, I received property overseas from my aunt that's worth around $130,000. Does this mean I definitely have to file Form 3520 since it exceeds $100,000, even though it's just real estate and not cash? Also, my tax guy (who admitted he doesn't know much about this form) claimed I'll need to file this every single year going forward like FBAR, even if I don't receive any more gifts. That seems weird to me - is that really true? I'm currently staying abroad and the deadline is coming up in less than two weeks. Can I submit this electronically somehow? If I have to mail it, how will I know the IRS actually received it? For the address section, should I use the same one from my tax return (my permanent US address) or my current foreign address where I'm actually staying? I'm worried about missing any communications since this form doesn't seem to have a spot for email like my regular tax return. If my regular taxes were done by a paid preparer, do they have to handle this form too, or can I just fill it out myself? Also curious - if the property gift is from a US citizen relative but the property itself is in another country, do I still need to report it on Form 3520? There's conflicting info everywhere and the IRS website is super vague. What's the difference between "initial return" and "final return" checkboxes? Which one applies when the property transfer is already completed? And finally, for a single real estate gift, do I need to include any attachments with the form? Thanks so much for any help you can offer!
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Connor Byrne
Your situation with Form 3520 is pretty common for people receiving foreign gifts. Let me help clear things up: For your first question - yes, if you received foreign real estate valued over $100,000, you need to file Form 3520. The type of asset doesn't matter - the $100,000 threshold applies to property just as it would to cash. No, Form 3520 is not like FBAR where you file annually. You only need to file Form 3520 in years when you receive qualifying gifts or have certain transactions with foreign trusts. If you don't receive additional foreign gifts exceeding the threshold in future years, you don't need to file it again. Unfortunately, there's no electronic filing option for Form 3520. You'll need to mail it. I suggest using certified mail with return receipt requested so you have proof of mailing and delivery. Use your address from your tax return for consistency. The IRS matches documents by your TIN and the name/address on your return. If you need to update your address, file Form 8822.
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Yara Elias
•Thanks for the detailed info! Do you know where exactly to mail Form 3520? Is it the same IRS address where I sent my 1040? Also, if my aunt who gave me the property is a permanent resident (green card holder) but not a citizen, does that change anything?
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Connor Byrne
•You should mail Form 3520 to the same address where you file your income tax return. The specific address depends on where you live and whether you're enclosing a payment, but it's generally the same address used for your 1040. Regarding your aunt's status - this is an important distinction. If your aunt is a green card holder, she's considered a U.S. person for tax purposes. Gifts from U.S. persons (citizens or residents) do NOT need to be reported on Form 3520, even if the property itself is located in a foreign country. Form 3520 is only required for gifts from foreign persons.
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QuantumQuasar
I went through a similar situation last year with a property gift from my uncle in Portugal. I was lost with all the requirements until I found taxr.ai (https://taxr.ai) which saved me so much stress. You upload your documents and it analyzes them to tell you exactly what forms you need to file and how to complete them correctly. What helped me most was that it specifically identified Form 3520 requirements for my foreign property gift and walked me through which sections applied to my situation. It even flagged the difference between gifts from foreign persons vs US citizens with foreign property, which can be confusing.
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Keisha Jackson
•Does taxr.ai actually help with filling out the form or just tells you which forms you need? Form 3520 looks really complicated and I'm worried about making mistakes.
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Paolo Moretti
•I'm skeptical about these tax tools. How accurate is it for something specialized like foreign gift reporting? The penalties for Form 3520 mistakes are huge - like 5% of the gift value per month up to 25%!
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QuantumQuasar
•It definitely helps with filling out the forms by giving you specific line-by-line guidance. For Form 3520, it breaks down each section and explains which parts you need to complete based on your situation. It flags the critical sections where people commonly make mistakes. For specialized forms like this, I found it surprisingly accurate. It uses IRS documentation and tax code to provide its guidance. What I appreciated most was how it explained the difference between reportable foreign gifts and non-reportable ones, which saved me from unnecessary filing. The penalties are indeed severe, which is exactly why having proper guidance is so important.
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Keisha Jackson
I just wanted to update after trying taxr.ai for my Form 3520 situation. It was actually really helpful! I uploaded my property deed and gift documentation, and it immediately identified that I only needed to complete certain parts of the form. The biggest revelation was learning that since my relative is a US citizen (even though the property is abroad), I don't need to file Form 3520 at all! The tool explained that Form 3520 only applies to gifts from foreign persons, not foreign property from US persons. This saved me from unnecessary filing and potential confusion with the IRS. The explanation referenced the exact IRS code sections which gave me confidence in the answer.
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Amina Diop
If you're struggling to get answers from the IRS about Form 3520, I'd recommend trying Claimyr (https://claimyr.com). I was in a similar situation last month with foreign gift reporting questions and couldn't get through to anyone at the IRS after trying for days. Claimyr got me connected to an actual IRS agent in about 20 minutes when I'd been trying for days before that. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c. The agent I spoke with clarified exactly which parts of Form 3520 I needed to complete for my foreign property gift and confirmed I didn't need to file it annually unless I received new gifts.
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Oliver Weber
•How does this actually work? The IRS phone lines are always busy whenever I call, so I'm having trouble believing anything could get through.
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Paolo Moretti
•This sounds too good to be true. Why would you pay a service to call the IRS when you can just keep calling yourself? And even if you get through, the IRS phone reps often give conflicting information about complex forms like 3520.
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Amina Diop
•It works by using an automated system that navigates the IRS phone tree and waits on hold for you. When they reach a live agent, you get a call to connect with them. It's basically handling the wait time so you don't have to sit there listening to hold music for hours. IRS agents can indeed sometimes give conflicting information, but I found that asking specific questions about Form 3520 filing requirements got me clear answers. The agent I spoke with pulled up the actual guidelines while on the phone with me and walked through the specific sections that applied to my situation. Getting direct confirmation from the IRS gave me peace of mind, especially with the significant penalties that can apply for incorrect filings.
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Paolo Moretti
I have to admit I was wrong about Claimyr. After our discussion, I decided to try it because I was getting desperate about my Form 3520 questions with the deadline approaching. I couldn't believe it actually worked! Got connected to an IRS representative in about 15 minutes when I'd been trying unsuccessfully for days. The agent confirmed several key points: 1) I only needed to file Form 3520 for the year I received the gift, not annually, 2) For real estate gifts, I should check "initial return" since it's my first time reporting this asset, and 3) I should attach a brief statement describing the property. They also confirmed that gifts from US citizens or residents (even of foreign property) don't require Form 3520, which aligns with what others mentioned. Saved me from a potentially expensive mistake since I was about to file unnecessarily for a gift from my US citizen uncle!
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Natasha Romanova
Just one more point that hasn't been mentioned - for question #8 about attachments, you should definitely include documentation that supports the valuation of the real estate. This could be an official appraisal, property tax documents from the foreign jurisdiction, or purchase documents if it was recently bought. The IRS may question how you determined the property value exceeds $100,000, so having documentation is important.
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Zainab Abdulrahman
•Thanks for bringing that up! What kind of documentation would be acceptable for proving the value? The property was last assessed about 3 years ago for tax purposes in the foreign country. Would that old assessment work or do I need something more recent?
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Natasha Romanova
•The foreign tax assessment from 3 years ago is a good starting point, but ideally you want something more current. The IRS is looking for a reasonable basis for the reported value at the time of the gift. If property values have changed significantly in that area over 3 years, the old assessment might not be accurate. If getting a new formal appraisal isn't practical before the deadline, you could include the tax assessment along with documentation of comparable property sales in the same area from around the time you received the gift. Real estate listings or sales data for similar properties can help establish current market value. Just include a brief statement explaining your valuation methodology.
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NebulaNinja
Quick question about mailing Form 3520 - does it need to be attached to my regular tax return or sent separately? I already filed my taxes for the year but just found out about this form requirement.
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Javier Gomez
•If you've already filed your tax return, you'll need to send Form 3520 separately. Make sure to include a copy of your filed tax return with it so the IRS can match them up. But don't file an amended return just for this - Form 3520 is filed separately even though it's due on the same date as your regular return.
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