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El Gato

Feb 7, 2012, 1:18 PM

Post #1 of 8 (1575 views)

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IRS filing Form 3520/3520A and/or 8938

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Someone said they thought we had to file an IRS form 3520 (and 3520A if our Bank didn't file it) if we had a trust - regardless of whether we were just using it as our residence. And then when I was working on my online taxes up popped for 8938 asking if we had any foreign investiments, trusts, etc. worth more then 50k - our trust is worth more then that.

Does anyone file them - do they need to be filed? IRS threatens major penalities if not.

Any input considered very helpful not only by me but several friends who don't know any more then I do!

Thanks in advance.
"The World After WW1 - 1918 - 1921" at amazon.com, Barnes & Nobel - letters written at the end of WWI

Aaron+

Feb 7, 2012, 2:17 PM

Post #2 of 8 (1553 views)

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Re: [El Gato] IRS filing Form 3520/3520A and/or 8938

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Go to Mexconnect´s search all forums function, plug in 3520, and enter.

3520 is for your initial submission (and any subsequent significant changes to your report), and 3520A for subsequent routine filings.

Mexican banks typically have no interest in filing such. Accordingly, it is your responsibility.

As for whether they "need to be filed," does not your note that "IRS threatens major penalties if not" answer your question?

El Gato

Feb 7, 2012, 2:43 PM

Post #3 of 8 (1545 views)

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Re: [Aaron+] IRS filing Form 3520/3520A and/or 8938

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Is form 8938 anything I have to worry about?

We don't have much in our bank account :) And CFE gets most of that.
"The World After WW1 - 1918 - 1921" at amazon.com, Barnes & Nobel - letters written at the end of WWI

Aaron+

Feb 7, 2012, 2:48 PM

Post #4 of 8 (1541 views)

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Re: [El Gato] IRS filing Form 3520/3520A and/or 8938

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Err... try searches for 8938 also here in Mexconnect, all forums.

Simplest answer, yes. Best answer, by a previous poster, is to consult a qualified Mexican accountant.

chicois8

Feb 7, 2012, 3:30 PM

Post #5 of 8 (1528 views)

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Re: [El Gato] IRS filing Form 3520/3520A and/or 8938

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I have my CPA do it each year, nothing coming in, fees for bank trust going out...very easy,a small price to pay if you are the one made example of....

morgaine7

Feb 7, 2012, 7:18 PM

Post #6 of 8 (1490 views)

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Re: [El Gato] IRS filing Form 3520/3520A and/or 8938

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I filed 3520 the first year and file 3520A annually for the fideicomiso, mostly a bunch of zeros since there's no income and nothing changes. I don't plan to file 8938 because I'm nowhere near the $200K cutoff for non-US residents. My understanding is that $50K applies only to US residents. Try this link.

El Gato

Feb 8, 2012, 2:41 PM

Post #7 of 8 (1427 views)

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Re: [morgaine7] IRS filing Form 3520/3520A and/or 8938

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I called the IRS today - got their usual dance around that they can't really give any advice and suggest getting a CPA, etc. (One would think that the IRS, who makes the rules, should actually be the ones that knows what the rules are!).

Anyway, I did get out of her that on from 8938 real estate, such as one's home, is not considered an investment. There for, if under the set limit (50K in our case) we didn't need to do the form. If we had $50,000 or more in a Mexican bank, stocks, etc., we would have had to file it.

Regarding the 3520 & 3520A she said they had to be filed every year even if no money changed hands. According to the instructions the Mexican bank is suppose to file 3520A (if they don't you have to) but our Bank claimed they didn't need to as they owned the trust and we were simply the beneficiaries of the trust. So obviously they aren't filing.

Forms seem simple enough. Just a pain.
"The World After WW1 - 1918 - 1921" at amazon.com, Barnes & Nobel - letters written at the end of WWI

YucaLandia

Feb 9, 2012, 6:10 AM

Post #8 of 8 (1376 views)

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Re: [morgaine7] IRS filing Form 3520/3520A and/or 8938

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The official IRS word on specific requirements for FATCA:

"Form 8938 is required when the total value of specified foreign assets exceeds certain thresholds. For example, a married couple living in the U.S. and filing a joint tax return would not file Form 8938 unless their total specified foreign assets exceed $100,000 on the last day of the tax year or more than $150,000 at any time during the tax year.
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The thresholds for taxpayers who reside abroad are higher. For example in this case, a married couple residing abroad and filing a joint return would not file Form 8938 unless the value of specified foreign assets exceeds $400,000 on the last day of the tax year or more than $600,000 at any time during the year.
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Instructions for Form 8938 explain the thresholds for reporting, what constitutes a specified foreign financial asset, how to determine the total value of relevant assets, what assets are exempted, and what information must be provided.
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Form 8938 is not required of individuals who do not have an income tax return filing requirement."

Hope this helps,
steve
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Read-on MacDuff
E-visit at http://yucalandia.wordpress.com/

(This post was edited by YucaLandia on Feb 9, 2012, 6:15 AM)