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Form 3520 & 3520-A compliance

Gifts and inheritances from relatives abroad, interests in foreign trusts, and certain transactions with foreign persons can trigger Form 3520 or Form 3520-A. The forms look simple but carry some of the steepest penalties in the tax code. We help you decide whether you must file, prepare the forms correctly, and fix missed filings.

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How we can help

Foreign gifts and inheritances

Gifts or bequests from a nonresident alien individual or foreign estate that total more than $100,000 in a year must be reported, even though they are generally not taxable. Gifts from foreign corporations and partnerships have a lower, inflation-adjusted threshold.

Foreign trusts

Transactions with foreign trusts, distributions you receive, and U.S. owners of foreign trusts, including grantor trust owner statements.

Form 3520-A

The annual information return of a foreign trust with a U.S. owner, due March 15 (with a six-month extension). The U.S. owner is responsible for it being filed.

Documentation

Gift deeds, bank transfer records and translations that show who gave what, when, and why.

Due dates

Form 3520 is due with your income tax return, including extensions. We put it on your calendar.

Penalties and relief

Late or missing filings can bring penalties of 5% of the gift per month up to 25%, and much higher percentages for trust transactions. We request relief for reasonable cause where it applies.

Catching up on missed filings

The IRS has procedures for filing delinquent international information returns. We assess your situation and choose the right path.

Related reporting

FBAR, Form 8938, Form 8621 for foreign funds, and your income tax return, kept consistent with each other.

How it works

Tell us what you received or hold

Describe the gift, inheritance, trust or transaction: who, how much, when, and from which country.

We decide what must be filed

We determine whether Form 3520, 3520-A or other forms apply and what documents we need.

We prepare and file

We prepare the forms, file them on time, and keep your records ready.

Good to know. Receiving a foreign gift is generally not taxable, but not reporting a large one can cost 5% of the gift for each month the form is late, up to 25%. Do not wait for a notice.

Common questions

Is a gift from my parents in India taxable?

Generally no, a gift is not income to the person who receives it. But if the total from nonresident individuals exceeds $100,000 in a year, you must report it on Form 3520.

When is Form 3520 due?

On the due date of your income tax return, including extensions: usually April 15, or October 15 if you extend.

I received a large gift years ago and never filed. What now?

Contact us before the IRS contacts you. There are procedures for delinquent filings and penalty relief, and the right approach depends on the facts.

Do I also need to file an FBAR?

Possibly. If the money sits in a foreign account and your foreign accounts total more than $10,000 at any time in the year, an FBAR may also be required. These are separate filings.

Related services

Individual & family tax preparation

Federal and state returns prepared with care, for residents, visa holders and families with income from more than one place.

Learn more →

International business setup

Expanding to India, Canada, Thailand, the UAE, Singapore or Hong Kong, or coming to the U.S.? We plan the structure and the U.S. tax side.

Learn more →

Foreign accounts & FBAR reporting

FBAR (FinCEN 114), Form 8938 and related filings, with a secure portal for your account details.

Learn more →

Let's talk about your taxes, your business, your plans.

Tell us what you need and we will get back to you quickly. There is no pressure: just a friendly conversation and a clear next step.

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Prem Tax and Accounting Corp
4260 Westbrook Dr, Suite 107
Aurora, IL 60504
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