When should I file Form 3520 for a foreign gift received in 2024?
I just received a pretty substantial gift from my aunt who lives overseas in December 2024. I'm not sure when I need to file Form 3520 to report this foreign gift. Do I need to file it this year (2024) or would I need to file it next year during the 2024 tax return filing period (2025)? I've never had to deal with this form before and I'm getting confused with the deadlines. My tax software doesn't seem to have clear instructions about this either. Anyone have experience with foreign gift reporting requirements? Thanks!
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Sophia Clark
Form 3520 (Annual Return to Report Transactions with Foreign Trusts and Receipt of Certain Foreign Gifts) should be filed at the same time as your regular income tax return. So if you received the foreign gift in 2024, you would report it on Form 3520 when you file your 2024 tax return, which would be in 2025 (typically by April 15th, unless you file for an extension). The form is considered timely filed if it's submitted by the due date of your tax return, including any extensions. Just remember that if the gift exceeds certain thresholds ($100,000 from a nonresident alien individual or foreign estate, or $17,339 for 2024 from foreign corporations or partnerships), you're required to report it.
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Katherine Harris
•Thanks for explaining! Quick question - does the Form 3520 need to be mailed separately or can it be e-filed with my regular tax return? And are there any specific penalties if I miss the deadline for filing this form?
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Sophia Clark
•You can attach Form 3520 to your regular tax return if you're filing by mail, but if you're e-filing, you might need to mail the Form 3520 separately depending on your tax software. Some tax preparation programs can e-file it, but not all of them have that capability. As for penalties, they can be pretty severe for failing to file Form 3520. The IRS can impose a penalty of the greater of $10,000 or 35% of the gross value of the gift you received. That's why it's really important to file this form on time and correctly.
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Madison Allen
I dealt with this exact situation last year. After struggling with trying to understand all these foreign gift reporting rules, I found this tool called taxr.ai (https://taxr.ai) that was super helpful for figuring out my Form 3520 situation. It analyzed all my foreign gift documents and gave me a clear breakdown of what needed to be reported and when. Saved me hours of research and probably kept me from making mistakes that would have triggered those nasty penalties someone else mentioned.
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Joshua Wood
•Did it also help with figuring out how to actually fill out the form? That's what I'm most confused about - there are so many sections and I don't know which parts apply to gifts versus trusts.
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Justin Evans
•Sounds interesting but how is it different from just using TurboTax or H&R Block? Do they not handle form 3520 well? I've never had to file one before but might need to this year.
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Madison Allen
•It definitely helped with filling out the form! It walks you through which sections apply to your specific situation and which ones you can skip. For gifts, you mainly focus on Part IV of the form, but the tool explains exactly what information goes where. Most mainstream tax software doesn't handle Form 3520 very well - they either don't support it at all for e-filing or don't provide much guidance. This is more specialized for international tax situations and foreign reporting requirements, which makes a big difference when dealing with something as specific as foreign gifts.
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Joshua Wood
Just wanted to update everyone! I tried using taxr.ai like suggested above and it was actually super helpful. I uploaded my documentation from the gift my grandparents sent me from Europe and it clearly showed me exactly what parts of Form 3520 I needed to complete. Even pointed out that I qualified for an exception I didn't know about! I was seriously stressing about getting this wrong and facing those huge penalties. Worth checking out if you're in a similar situation with foreign gifts or trusts.
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Emily Parker
If anyone is trying to get answers directly from the IRS about Form 3520 deadlines or requirements, good luck with that! I spent DAYS trying to get through to someone who actually understood this form. After being on hold for hours and getting transferred multiple times, I finally gave up and tried using Claimyr (https://claimyr.com). They have this service where they basically wait on hold with the IRS for you and then call you when an agent is actually on the line. You can see how it works here: https://youtu.be/_kiP6q8DX5c When I finally got connected to an IRS specialist, they confirmed that Form 3520 follows the same deadline as your personal tax return and cleared up some questions I had about reporting thresholds for my specific situation.
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Ezra Collins
•Wait, how does this actually work? Do you have to give them personal info? I'm always skeptical about services that claim to help with the IRS.
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Victoria Scott
•This sounds like a scam. No way the IRS would allow a third party service to "hold your place in line." I'll stick to waiting on hold myself, thank you very much. Not giving my info to some random company.
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Emily Parker
•It's actually pretty straightforward - you provide your phone number and what IRS department you need to reach. They use an automated system to wait on hold, and when an IRS agent picks up, their system connects the call to your phone. You don't have to provide any tax information to Claimyr - you only discuss your tax details directly with the IRS agent. They're not holding your place in line in any official way - they're literally just waiting on hold so you don't have to. When you get the call back, it's a direct connection to the IRS and you speak directly with the agent yourself. It's just saving you from having to listen to hold music for hours.
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Victoria Scott
I have to admit I was completely wrong about Claimyr. After waiting on hold with the IRS for over 3 hours yesterday trying to get clarification about my Form 3520 situation, I broke down and tried the service. Within about 45 minutes, I got a call connecting me directly to an IRS international tax specialist. Got all my questions answered about reporting foreign gifts and the timing for filing Form 3520. The agent clarified that I need to file with my 2024 return but before the due date. Just wanted to update since my previous comment was unnecessarily negative. Sometimes new services actually do work as advertised!
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Benjamin Johnson
One important thing to know about Form 3520 - if you're filing it for a foreign gift, make sure you're actually required to file it in the first place. The threshold for gifts from individuals is $100,000 total for the year. If your gift is below that amount, you might not need to file this form at all. Could save you some headache.
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Zara Perez
•Is that $100,000 threshold per gift or total from all foreign individuals for the year? My brother sent me $30k and my aunt sent me $80k, both from Canada.
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Benjamin Johnson
•That would be total from all foreign individuals for the year. Since your brother sent $30k and your aunt sent $80k, that adds up to $110k total, which exceeds the $100k threshold. So yes, you would need to file Form 3520 in this case.
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Daniel Rogers
Does anyone know if there's a way to amend a previous year's tax return to add a Form 3520 that I should have filed? I received a gift from my uncle in Germany in 2023 but didn't know about the reporting requirement until now.
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Aaliyah Reed
•Yes, you can file a late Form 3520. You'd need to complete the form for tax year 2023 and send it in asap. There might be penalties, but filing late is better than not filing at all. The IRS sometimes waives penalties if you have a reasonable cause for the late filing and include a letter explaining the situation.
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Alexis Renard
For anyone dealing with Form 3520 for the first time, here's a quick tip that helped me: keep detailed records of the gift including the date received, amount in both foreign currency and USD (using the exchange rate on the date received), and documentation showing the relationship to the gift giver. The IRS wants to see that it's truly a gift and not income in disguise. Also, if you're close to any of the thresholds mentioned above, it's worth consulting with a tax professional who specializes in international tax issues - the penalties for getting this wrong are steep enough that professional help often pays for itself.
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Olivia Evans
•This is really helpful advice! I'm curious about the exchange rate part - do you use the rate from a specific source like XE.com or does the IRS have a preferred exchange rate source they want you to use? Also, when you mention "income in disguise," what kind of documentation typically satisfies the IRS that it's truly a gift? I'm worried they might question a large gift from a relative I don't see very often.
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