Form 3520 – Transactions with Foreign Trusts

📋 Form 3520 – Transactions with Foreign Trusts :-

Annual Return To Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts.

📘 Purpose:-
Used by U.S. persons (citizens, residents, or entities) to report certain transactions with foreign trusts or receipt of large gifts or inheritances from foreign individuals or entities.

📋 You must file Form 3520 if you:
1️⃣ Receive money or property from a foreign trust,
2️⃣ Are the owner of a foreign trust under U.S. tax rules,
3️⃣ Receive gifts or bequests from a non-U.S. person exceeding certain thresholds (e.g., $100,000 from an individual or $ 19,570 from a corporation/partnership in 2025 – limits may change each year).

⚠️ Penalty for non-filing:
Up to 35% of the gross reportable amount, so timely filing is very important.

📅 Due date:
Same as the individual income tax return (Form 1040) — usually April 15, with an automatic extension to October 15 if you file Form 4868.