WHO TO CONTACT DURING THE LIVE PROGRAM

For Additional Registrations:-Call Strafford Customer Service 1-800-926-7926 x1 (or 404-881-1141 x1)

For Assistance During the Live Program:-On the web, use the chat box at the bottom left of the screen

If you get disconnected during the program, you can simply log in using your original instructions and PIN.

IMPORTANT INFORMATION FOR THE LIVE PROGRAM

This program is approved for 2 CPE credit hours. To earn credit you must:

• Participate in the program on your own computer connection (no sharing) – if you need to register additional people, please call customer service at 1-800-926-7926 ext. 1 (or 404-881-1141 ext. 1). Strafford accepts American Express, Visa, MasterCard, Discover.

• Listen on-line via your computer speakers.

• Respond to five prompts during the program plus a single verification code.

• To earn full credit, you must remain connected for the entire program.

Foreign Trust Challenges for U.S. Tax Professionals

THURSDAY, AUGUST 6, 2020, 1:00-2:50 pm Eastern

FOR LIVE PROGRAM ONLY

Form 1040-NR2019

U.S. Nonresident Alien Income Tax Return

Department of the Treasury Internal Revenue Service

▶ Go to www.irs.gov/Form1040NR for instructions and the latest information.OMB No. 1545-0074

For the year January 1–December 31, 2019, or other tax year

beginning , 2019, and ending , 20

Please print or type

Your first name and middle initial Last name Identifying number (see instructions)

Present home address (number and street or rural route). If you have a P.O. box, see instructions. Apt. no. Check if: Individual

Estate or Trust

City, town or post office, state, and ZIP code. If you have a foreign address, also complete spaces below. See instructions.

Foreign country name Foreign province/state/county Foreign postal code

Filing Status

Check only one box.

1 Reserved2 Single nonresident alien3 Reserved

4 Reserved5 Married nonresident alien6 Qualifying widow(er) (see instructions)

Child’s name ▶

DependentsIf more than four dependents, see instructions and check here.

7 Dependents: (see instructions) (2) Dependent’s identifying number

(3) Dependent’s relationship to you

(4) ✔ if qualifies for (see instr.):(1) First name Last name Child tax credit Credit for other dependents

Income Effectively Connected With U.S. Trade/ Business

Attach Form(s) W-2, 1042-S, SSA-1042S, RRB-1042S, and 8288-A here. Also attach Form(s) 1099-R if tax was withheld.

8 Wages, salaries, tips, etc. Attach Form(s) W-2 . . . . . . . . . . . . . . . 89a Taxable interest . . . . . . . . . . . . . . . . . . . . . . . . . 9ab Tax-exempt interest. Do not include on line 9a . . . . . . . 9b

10a Ordinary dividends . . . . . . . . . . . . . . . . . . . . . . . . 10ab Qualified dividends (see instructions) . . . . . . . . . . 10b

11 Taxable refunds, credits, or offsets of state and local income taxes (see instructions) . . . 1112 Scholarship and fellowship grants. Attach Form(s) 1042-S or required statement (see instructions) 1213 Business income or (loss). Attach Schedule C (Form 1040 or 1040-SR) . . . . . . . 1314 Capital gain or (loss). Attach Schedule D (Form 1040 or 1040-SR) if required. If not required, check here 1415 Other gains or (losses). Attach Form 4797 . . . . . . . . . . . . . . . . . 1516a IRA distributions . . . . . 16a 16b Taxable amount (see instr.) 16b17a Pensions and annuities . . . 17a 17b Taxable amount (see instr.) 17b18 Rental real estate, royalties, partnerships, trusts, etc. Attach Schedule E (Form 1040 or 1040-SR) 1819 Farm income or (loss). Attach Schedule F (Form 1040 or 1040-SR) . . . . . . . . . 1920 Unemployment compensation . . . . . . . . . . . . . . . . . . . . 2021 Other income. List type and amount (see instructions) 2122 Total income exempt by a treaty from page 5, Schedule OI, item L (1(e)) 22

23 Combine the amounts in the far right column for lines 8 through 21. This is your total effectively connected income . . . . . . . . . . . . . . . . . . . ▶ 23

Adjusted Gross Income

24 Educator expenses (see instructions) . . . . . . . . . . 2425 Health savings account deduction. Attach Form 8889 . . . . . 2526 Moving expenses for members of the Armed Forces. Attach Form

3903 . . . . . . . . . . . . . . . . . . . . 2627 Deductible part of self-employment tax. Attach Schedule SE (Form

1040 or 1040-SR) . . . . . . . . . . . . . . . . 2728 Self-employed SEP, SIMPLE, and qualified plans . . . . . . 2829 Self-employed health insurance deduction (see instructions) . . . 2930 Penalty on early withdrawal of savings . . . . . . . . . . 3031 Scholarship and fellowship grants excluded . . . . . . . . 3132 IRA deduction (see instructions) . . . . . . . . . . . . 3233 Student loan interest deduction (see instructions) . . . . . . 3334 Add lines 24 through 33 . . . . . . . . . . . . . . . . . . . . . . 3435 Adjusted Gross Income. Subtract line 34 from line 23 . . . . . . . . . . . ▶ 35

Tax and Credits

36 Reserved for future use . . . . . . . . . . . . . . . . . . . . . . 3637 Itemized deductions from page 3, Schedule A, line 8 . . . . . . . . . . . . . 3738 Qualified business income deduction. Attach Form 8995 or Form 8995-A . . . . . . . 3839 Exemptions for estates and trusts only (see instructions) . . . . . . . . . . . . 39

For Disclosure, Privacy Act, and Paperwork Reduction Act Notice, see instructions. Cat. No. 11364D Form 1040-NR (2019)

Form 1040-NR (2019) Page 2

Tax and Credits (continued)

40 Add lines 37 through 39 . . . . . . . . . . . . . . . . . . . . . . 4041 Taxable income. Subtract line 40 from line 35. If zero or less, enter -0- . . . . . . . 4142 Tax (see instr.). Check if any is from Form(s): a 8814 b 4972 c 4243 Alternative minimum tax (see instructions). Attach Form 6251 . . . . . . . . . . 4344 Excess advance premium tax credit repayment. Attach Form 8962 . . . . . . . . . 4445 Add lines 42, 43, and 44 . . . . . . . . . . . . . . . . . . . . . ▶ 4546 Foreign tax credit. Attach Form 1116 if required . . . . . . . 4647 Credit for child and dependent care expenses. Attach Form 2441 . 4748 Retirement savings contributions credit. Attach Form 8880 . . . 4849 Child tax credit and credit for other dependents (see instructions) . 4950 Residential energy credits. Attach Form 5695 . . . . . . . 5051 Other credits from Form: a 3800 b 8801 c 5152 Add lines 46 through 51. These are your total credits . . . . . . . . . . . . . 5253 Subtract line 52 from line 45. If zero or less, enter -0- . . . . . . . . . . . . ▶ 53

Other Taxes

54 Tax on income not effectively connected with a U.S. trade or business from page 4, Schedule NEC, line 15 . . . . . . . . . . . . . . . . . . . . . . . . . . 54

55 Self-employment tax. Attach Schedule SE (Form 1040 or 1040-SR) . . . . . . . . . 5556 Unreported social security and Medicare tax from Form: a 4137 b 8919 . . . . 5657 Additional tax on IRAs, other qualified retirement plans, etc. Attach Form 5329 if required . . 5758 Transportation tax (see instructions) . . . . . . . . . . . . . . . . . . 5859a Household employment taxes from Schedule H (Form 1040 or 1040-SR) . . . . . . . 59a

b Repayment of first-time homebuyer credit from Form 5405. Attach Form 5405 if required . . 59b60 Taxes from: a Form 8959 b Instructions; enter code(s) 6061 Total tax. Add lines 53 through 60 . . . . . . . . . . . . . . . . . . ▶ 61

Payments 62 Federal income tax withheld from:a Form(s) W-2 and 1099 . . . . . . . . . . . . . . . 62ab Form(s) 8805 . . . . . . . . . . . . . . . . . . 62bc Form(s) 8288-A . . . . . . . . . . . . . . . . . 62cd Form(s) 1042-S . . . . . . . . . . . . . . . . . 62d

63 2019 estimated tax payments and amount applied from 2018 return 6364 Additional child tax credit. Attach Schedule 8812 . . . . . . 6465 Net premium tax credit. Attach Form 8962 . . . . . . . . 6566 Amount paid with request for extension to file (see instructions) . . 6667 Excess social security and tier 1 RRTA tax withheld (see instructions) 6768 Credit for federal tax on fuels. Attach Form 4136 . . . . . . 6869 Credits from Form: a 2439 b Reserved c 8885 d 6970 Credit for amount paid with Form 1040-C . . . . . . . . . 7071 Add lines 62a through 70. These are your total payments . . . . . . . . . . ▶ 71

RefundDirect deposit? See instructions.

72 If line 71 is more than line 61, subtract line 61 from line 71. This is the amount you overpaid 7273a Amount of line 72 you want refunded to you. If Form 8888 is attached, check here . . ▶ 73a

b Routing number ▶ c Type: Checking Savings

d Account numbere If you want your refund check mailed to an address outside the United States not shown on page 1, enter it here.

74 Amount of line 72 you want applied to your 2020 estimated tax ▶ 74Amount You Owe

75 Amount you owe. Subtract line 71 from line 61. For details on how to pay, see instructions ▶ 7576 Estimated tax penalty (see instructions) . . . . . . . . . 76

Third Party Designee

Do you want to allow another person to discuss this return with the IRS? See instructions Yes. Complete below. NoDesignee’s name ▶

Phone no. ▶

Personal identification number (PIN) ▶

Sign Here

Keep a copy of this return for your records.

Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and belief, they are true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge.

Your signature

▲

Date Your occupation in the United States If the IRS sent you an Identity Protection PIN, enter it here (see instr.)

Paid Preparer Use Only

Print/Type preparer’s name Preparer’s signature Date Check if self-employed

PTIN

Firm’s name ▶ Firm’s EIN ▶

Firm’s address ▶ Phone no.

Form 1040-NR (2019)

Form 1040-NR (2019) Page 3

Schedule A—Itemized Deductions (see instructions) 07

Taxes You Paid 1 State and local income taxes

a State and local income taxes . . . . . . . . . . . . 1a

b Enter the smaller of line 1a and $10,000 ($5,000 if box 5 is checked) . . . . . . . . 1b

Gifts to U.S. Charities Caution: If you made a gift and received a benefit in return, see instructions.

2 Gifts by cash or check. If you made any gift of $250 or more, see instructions . . . . . . . . . . . . . . . . . 2

3

Other than by cash or check. If you made any gift of $250 or more, see instructions. Individuals must attach Form 8283 if line 3 is over $500 . . . . . . . . . . . . . . . . . . . . 3

4 Carryover from prior year . . . . . . . . . . . . . 4

5 Add lines 2 through 4 . . . . . . . . . . . . . . . . . . . . . . 5

Casualty and Theft Losses

6

Casualty and theft loss(es) from a federally declared disaster (other than net qualified disaster losses). Attach Form 4684 and enter the amount from line 18 of that form. See instructions . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Other Itemized Deductions

7 Other—from list in instructions. List type and amount ▶

7Total Itemized Deductions

8 Add the amounts in the far right column for lines 1b through 7. Also, enter this amount on Form 1040-NR, line 37 . . . . . . . . . . . . . . . . . . . . . . 8

Form 1040-NR (2019)

Form 1040-NR (2019) Page 4 Schedule NEC—Tax on Income Not Effectively Connected With a U.S. Trade or Business (see instructions)

Nature of income

Enter amount of income under the appropriate rate of tax (see instructions)

(a) 10% (b) 15% (c) 30%(d) Other (specify)

% %1 Dividends and dividend equivalents:

a Dividends paid by U.S. corporations . . . . . . . . . . . . . 1ab Dividends paid by foreign corporations . . . . . . . . . . . . . 1b

c Dividend equivalent payments received with respect to section 871(m) transactions . . . . . . . . . . . . . . . . . . . . . 1c

2 Interest:a Mortgage . . . . . . . . . . . . . . . . . . . . . . 2ab Paid by foreign corporations . . . . . . . . . . . . . . . . 2bc Other . . . . . . . . . . . . . . . . . . . . . . . 2c

3 Industrial royalties (patents, trademarks, etc.) . . . . . . . . . . . 34 Motion picture or T.V. copyright royalties . . . . . . . . . . . . 45 Other royalties (copyrights, recording, publishing, etc.) . . . . . . . . 56 Real property income and natural resources royalties . . . . . . . . 67 Pensions and annuities . . . . . . . . . . . . . . . . . . 78 Social security benefits . . . . . . . . . . . . . . . . . . 89 Capital gain from line 18 below . . . . . . . . . . . . . . . 9

10 Gambling—Residents of Canada only. Enter net income in column (c).If zero or less, enter -0-.

a Winningsb Losses . . . . . . . . . . . . . . . 10c

11 Gambling winnings—Residents of countries other than Canada.Note: Losses not allowed . . . . . . . . . . . . . . . . . 11

12 Other (specify) ▶

1213 Add lines 1a through 12 in columns (a) through (d) . . . . . . . . . 1314 Multiply line 13 by rate of tax at top of each column . . . . . . . . 14

15 Tax on income not effectively connected with a U.S. trade or business. Add columns (a) through (d) of line 14. Enter the total here and on Form 1040-NR, line 54 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ▶ 15

Capital Gains and Losses From Sales or Exchanges of PropertyEnter only the capital gains and losses from property sales or exchanges that are from sources within the United States and not effectively connected with a U.S. business. Do not include a gain or loss on disposing of a U.S. real property interest; report these gains and losses on Schedule D (Form 1040 or 1040-SR).

Report property sales or exchanges that are effectively connected with a U.S. business on Schedule D (Form 1040 or 1040-SR), Form 4797, or both.

16 (a) Kind of property and description (if necessary, attach statement of

descriptive details not shown below)

(b) Date acquired (mo., day, yr.)

(c) Date sold (mo., day, yr.)

(d) Sales price(e) Cost or other basis

(f) LOSS If (e) is more than (d), subtract (d) from (e)

(g) GAIN If (d) is more than (e), subtract (e) from (d)

17 Add columns (f) and (g) of line 16 . . . . . . . . . . . . . . . . . . . . . . . 17 ( ) 18 Capital gain. Combine columns (f) and (g) of line 17. Enter the net gain here and on line 9 above (if a loss, enter -0-) . ▶ 18

Form 1040-NR (2019)

Form 1040-NR (2019) Page 5 Schedule OI—Other Information (see instructions)

Answer all questions

A Of what country or countries were you a citizen or national during the tax year?B In what country did you claim residence for tax purposes during the tax year?C Have you ever applied to be a green card holder (lawful permanent resident) of the United States? . . . . . Yes NoD Were you ever:

1. A U.S. citizen? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Yes No2. A green card holder (lawful permanent resident) of the United States? . . . . . . . . . . . . . . Yes No

If you answer “Yes” to (1) or (2), see Pub. 519, chapter 4, for expatriation rules that apply to you.

E If you had a visa on the last day of the tax year, enter your visa type. If you did not have a visa, enter your U.S. immigration status on the last day of the tax year.

F Have you ever changed your visa type (nonimmigrant status) or U.S. immigration status? . . . . . . . . Yes NoIf you answered “Yes,” indicate the date and nature of the change. ▶

G List all dates you entered and left the United States during 2019. See instructions.

Note: If you are a resident of Canada or Mexico AND commute to work in the United States at frequent intervals, check the box for Canada or Mexico and skip to item H . . . . . . . . . Canada Mexico

Date entered United States mm/dd/yy

Date departed United States mm/dd/yy

Date entered United States mm/dd/yy

Date departed United States mm/dd/yy

H Give number of days (including vacation, nonworkdays, and partial days) you were present in the United States during: 2017 , 2018 , and 2019 .

I Did you file a U.S. income tax return for any prior year? . . . . . . . . . . . . . . . . . . . Yes NoIf “Yes,” give the latest year and form number you filed . . . ▶

J Are you filing a return for a trust? . . . . . . . . . . . . . . . . . . . . . . . . . . Yes No

If “Yes,” did the trust have a U.S. or foreign owner under the grantor trust rules, make a distribution or loan to a U.S. person, or receive a contribution from a U.S. person? . . . . . . . . . . . . . . . . . . Yes No

K Did you receive total compensation of $250,000 or more during the tax year? . . . . . . . . . . . . Yes NoIf “Yes,” did you use an alternative method to determine the source of this compensation? . . . . . . . Yes No

L Income Exempt from Tax—If you are claiming exemption from income tax under a U.S. income tax treaty with a foreign country, complete (1) through (3) below. See Pub. 901 for more information on tax treaties.

1. Enter the name of the country, the applicable tax treaty article, the number of months in prior years you claimed the treaty benefit, and the amount of exempt income in the columns below. Attach Form 8833 if required. See instructions.

(a) Country (b) Tax treaty article(c) Number of months

claimed in prior tax years(d) Amount of exempt

income in current tax year

(e) Total. Enter this amount on Form 1040-NR, line 22. Do not enter it on line 8 or line 12 . . ▶

2. Were you subject to tax in a foreign country on any of the income shown in 1(d) above? . . . . . . . . Yes No3. Are you claiming treaty benefits pursuant to a Competent Authority determination? . . . . . . . . . . Yes No

If “Yes,” attach a copy of the Competent Authority determination letter to your return.M Check the applicable box if:

1. This is the first year you are making an election to treat income from real property located in the United States as effectively connected with a U.S. trade or business under section 871(d). See instructions . . . . . . . . . . . . . . . . . . ▶

2. You have made an election in a previous year that has not been revoked, to treat income from real property located in the United States as effectively connected with a U.S. trade or business under section 871(d). See instructions . . . . . . . . ▶

Form 1040-NR (2019)

Form 3520Department of the Treasury Internal Revenue Service

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

▶ Go to www.irs.gov/Form3520 for instructions and the latest information.

OMB No. 1545-0159

2019Note: All information must be in English. Show all amounts in U.S. dollars. File a separate Form 3520 for each foreign trust.For calendar year 2019, or tax year beginning , 2019, ending , 20A Check appropriate boxes: Initial return Initial return (extension filed) Final return Amended returnB Check box that applies to person filing return: Individual Partnership Corporation Trust ExecutorC Check if any excepted specified foreign financial assets are reported on this form (see instructions) . . . . . . . . .Check all applicable boxes.

(a) You are a U.S. transferor who, directly or indirectly, transferred money or other property during the current tax year to a foreign trust, (b) You are a U.S. person who (1) during the current tax year, transferred property (including cash) to a related foreign trust (or a person related to the trust) in exchange for an obligation, or (2) holds a qualified obligation from the trust that is currently outstanding, or (c) You are the executor of the estate of a U.S. decedent and (1) the decedent made a transfer to a foreign trust by reason of death, (2) the decedent was treated as the owner of any portion of a foreign trust immediately prior to death, or (3) the decedent’s estate included any portion of the assets of a foreign trust. Complete all applicable identifying information requested below and Part I of the form and see the instructions for Part I.

You are a U.S. owner of all or any portion of a foreign trust at any time during the tax year. Complete all applicable identifying information requested below and Part II of the form and see the instructions for Part II. You may also need to complete lines 15 through 18 of Part I if you answered “No” to line 3 and Part III. See the instructions for Parts I and III.

(a) You are a U.S. person (including a U.S. owner) or an executor of the estate of a U.S. person who, during the current tax year, received, directly or indirectly, a distribution from a foreign trust, (b) You are a U.S. person who is a U.S. owner or beneficiary of a foreign trust and in the current tax year, you or a U.S. person related to you received (1) a loan of cash or marketable securities, directly or indirectly, from such foreign trust, or (2) the uncompensated use of trust property, or (c) You are a U.S. person who is a U.S. owner or beneficiary of a foreign trust and in the current tax year such foreign trust holds an outstanding qualified obligation of yours or a U.S. person related to you. Complete all applicable identifying information requested below and Part III of the form and see the instructions for Part III.

You are a U.S. person who, during the current tax year, received certain gifts or bequests from a foreign person. Complete all applicable identifying information requested below and Part IV of the form and see the instructions for Part IV.

1a Name of U.S. person(s) with respect to whom this Form 3520 is being filed (see instructions) b Identification number

c Number, street, and room or suite no. (if a P.O. box, see instructions) d Spouse’s identification number

e City or town f State or province g ZIP or foreign postal code h Country

i Check the box if you are married and filing a joint 2019 income tax return, and you are filing a joint Form 3520 with your spouse.

j Service center where U.S. person’s tax return is filed . . . . . . . . . . . . . . . . . ▶

k If an extension was requested for the tax return, check this box and enter the form number of the tax return to be filed. ▶

2a Name of foreign trust (if applicable) b(1) Employer identification number (if any)

b(2) Reference ID number (see instructions)c Number, street, and room or suite no. (if a P.O. box, see instructions)

d City or town e State or province f ZIP or foreign postal code g Country

3 Did the foreign trust appoint a U.S. agent (defined in the instructions) who can provide the IRS with all relevant trust information? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Yes NoIf “Yes,” complete lines 3a through 3g. If “No,” be sure to complete Part I, lines 15 through 18.

3a Name of U.S. agent b Identification number (if any)

c Number, street, and room or suite no. (if a P.O. box, see instructions)

d City or town e State or province f ZIP or postal code g Country

4a Name of U.S. decedent (see instr.) b Address c TIN of decedent

d Date of death e EIN of estate

f Check applicable box.U.S. decedent made transfer to a foreign trust by reason of death.

U.S. decedent treated as owner of foreign trust immediately prior to death.

Assets of foreign trust were included in estate of U.S. decedent.

For Privacy Act and Paperwork Reduction Act Notice, see instructions. Cat. No. 19594V Form 3520 (2019)

Form 3520 (2019) Page 2Part I Transfers by U.S. Persons to a Foreign Trust During the Current Tax Year (see instructions)

5a Name of trust creator b Address c Identification number (if any)

6a Country code of country where trust was created b Country code of country whose law governs the trust c Date trust was created

7a Will any person (other than the foreign trust) be treated as the owner of the transferred assets after the transfer? . . . Yes No

b (i) Name of all foreign

trust owners

(ii) Address

(iii) Country of residence

(iv) Identification number, if any

(v) Relevant Code

section

8 Was the transfer a completed gift or bequest? If “Yes,” see instructions . . . . . . . . . . . . . . . Yes No

9a Now or at any time in the future, can any part of the income or corpus of the trust benefit any U.S. beneficiary? . . . Yes No

b If “No,” could the trust be revised or amended to benefit a U.S. beneficiary?. . . . . . . . . . . . . . Yes No10 Reserved . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Yes No

Schedule A—Obligations of a Related Trust (see instructions)

11 a During the current tax year, did you transfer property (including cash) to a related foreign trust in exchange for an obligation of the trust or an obligation of a person related to the trust (see instructions)? . . . . . . . . . . Yes NoIf “Yes,” complete the rest of Schedule A, as applicable. If “No,” go to Schedule B.

b Were any of the obligations you received (with respect to a transfer described in line 11a above) qualified obligations? . Yes No

If “Yes,” complete the rest of Schedule A and attach a copy of each loan document entered into with respect to each qualified obligation reported on line 11(b). If these documents have been attached to a Form 3520 filed within the previous 3 years, attach only relevant updates.

If “No,” go to Schedule B.

(i) Date of transfer giving rise to obligation

(ii) Maximum term

(iii) Yield to maturity

(iv) FMV of obligation

12

With respect to each qualified obligation you reported on line 11b: Do you agree to extend the period of assessment of any income or transfer tax attributable to the transfer, and any consequential income tax changes for each year that the obligation is outstanding, to a date 3 years after the maturity date of the obligation? . . . . . . . . . . . Yes No

Note: You have the right to refuse to extend the period of limitations or limit this extension to a mutually agreed-upon issue(s) or mutually agreed-upon period of time. Generally, if you refuse to extend the period of limitations with respect to each qualified obligation you reported on line 11b, then such obligation is not a qualified obligation and you cannot check “Yes” to the question on line 11b.

Schedule B—Gratuitous Transfers (see instructions)

13 During the current tax year, did you make any transfers (directly or indirectly) to the trust and receive less than FMV, or no consideration at all, for the property transferred? . . . . . . . . . . . . . . . . . . . . Yes No

If “Yes,” complete columns (a) through (i) below and the rest of Schedule B, as applicable. When completing columns (a) through (i) with respect to each nonqualified obligation, enter “-0-” in column (h).

If “No,” go to Schedule C.

(a) Date of transfer

(b) Description of property transferred

(c) FMV of property

transferred

(d) U.S. adjusted

basis of property

transferred

(e) Gain recognized

at time of transfer,

if any

(f) Excess, if any, of column (c)

over the sum of columns

(d) and (e)

(g) Description of property received,

if any

(h) FMV of property

received

(i) Excess of

column (c) over column (h)

Totals ▶ $ $

14 You are required to attach a copy of each sale or loan document entered into in connection with a transfer reported on line 13. If these documents have been attached to a Form 3520 filed within the previous 3 years, attach only relevant updates.

Are you attaching a copy of: Yes NoAttached

PreviouslyYear

Attached

a Sale document? . . . . . . . . . . . . . . . . . . . . . .

b Loan document? . . . . . . . . . . . . . . . . . . . . . .c Subsequent variances to original sale or loan documents? . . . . . . . . . .

Form 3520 (2019)

Form 3520 (2019) Page 3Part I Schedule B—Gratuitous Transfers (continued)

Note: Complete lines 15 through 18 only if you answered “No” to line 3, acknowledging that the foreign trust did not appoint a U.S. agent to provide the IRS with all relevant trust information.

15(a)

Name of beneficiary(b)

Address of beneficiary

(c) U.S. beneficiary? (d)

Identification number, if any Yes No

16 (a) Name of trustee

(b) Address of trustee

(c) Identification number, if any

17 (a) Name of other persons

with trust powers

(b) Address of other persons with trust powers

(c) Description of

powers

(d) Identification number, if any

18 If you checked “No” on line 3, you are required to attach a copy of all trust documents as indicated below. If these documents have been attached to a Form 3520-A or Form 3520 filed within the previous 3 years, attach only relevant updates.

Are you attaching a copy of: Yes NoAttached

PreviouslyYear

Attached

a Summary of all written and oral agreements and understandings relating to the trust? . .

b The trust instrument? . . . . . . . . . . . . . . . . . . . . .

c Memoranda or letters of wishes? . . . . . . . . . . . . . . . . .

d Subsequent variances to original trust documents? . . . . . . . . . . . .

e Trust financial statements? . . . . . . . . . . . . . . . . . . .

f Other trust documents? . . . . . . . . . . . . . . . . . . . .Schedule C—Qualified Obligations Outstanding in the Current Tax Year (see instructions)

19 Did you, at any time during your tax year, hold an outstanding obligation of a related foreign trust (or a person related to the trust) that you reported as a “qualified obligation” in the current tax year? . . . . . . . . . . . . . Yes NoIf “Yes,” complete columns (a) through (e) below.

(a) Date of original

obligation

(b) Tax year qualified

obligation first reported

(c) Amount of principal

payments made during your tax year

(d) Amount of interest

payments made during your tax year

(e) Does the obligation

still meet the criteria for a

qualified obligation?

Yes No

Form 3520 (2019)

Form 3520 (2019) Page 4Part II U.S. Owner of a Foreign Trust (see instructions)20 (a)

Name of all foreign trust owners

(b) Address

(c) Country of tax residence

(d) Identification number, if any

(e) Relevant Code

section

21 (a) Country code of country where foreign trust

was created

(b) Country code of country whose law governs the foreign trust

(c) Date foreign trust was created

22 Did the foreign trust file Form 3520-A for the current year? . . . . . . . . . . . . . . . . . . . Yes No

If “Yes,” attach the Foreign Grantor Trust Owner Statement you received from the foreign trust.

If “No,” to the best of your ability, complete and attach a substitute Form 3520-A for the foreign trust.

See instructions for information on penalties for failing to complete and attach a substitute Form 3520-A.23 Enter the gross value of the portion of the foreign trust that you are treated as owning at the end of your tax year ▶ $

Part III Distributions to a U.S. Person From a Foreign Trust During the Current Tax Year (see instructions)Note: If you received an amount from a portion of a foreign trust of which you are treated as the owner, only complete lines 24 and 27.

24 Cash amounts or FMV of property received, directly or indirectly, during your current tax year, from the foreign trust (exclude loans and uncompensated use of trust property included on line 25).

(a) Date of distribution

(b) Description of property received

(c) FMV of property received

(determined on date of distribution)

(d) Description of property

transferred, if any

(e) FMV of property

transferred

(f) Excess of column (c)

over column (e)

Totals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ▶ $

25 During your current tax year, did you (or a person related to you) receive a loan or uncompensated use of trust property from a related foreign trust (including an extension of credit upon the purchase of property from the trust)? . . . . . Yes NoIf “Yes,” complete columns (a) through (g) below for each such loan or use of trust property.

Note: See instructions for additional information, including how to complete columns (a) through (g) for use of trust property.

(a) FMV of loan proceeds

or property

(b) Date of original

transaction

(c) Maximum term of

repayment of obligation

(d) Interest rate of obligation

(e) Is the obligation a

“qualified obligation?”(f)

FMV of qualified obligation

(g) Amount treated as distribution

from the trust (subtract column (f) from column (a)) Yes No

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ▶ $

26

With respect to each obligation you reported as a “qualified obligation” on line 25: Do you agree to extend the period of assessment of any income or transfer tax attributable to the transaction, and any consequential income tax changes for each year that the obligation is outstanding, to a date 3 years after the maturity date of the obligation? . . . . . . Yes No

Note: You have the right to refuse to extend the period of limitations or limit this extension to a mutually agreed-upon issue(s) or mutually agreed-upon period of time. Generally, if you refuse to extend the period of limitations with respect to an obligation that you reported as a “qualified obligation” on line 25, then such obligation is not a qualified obligation and you cannot check “Yes” in column (e) of line 25.

27 Total distributions received during your current tax year. Add line 24, column (f), and line 25, column (g) . . ▶ $

28 Did the trust, at any time during the current tax year, hold an outstanding obligation of yours (or a person related to you) that you reported as a “qualified obligation”? . . . . . . . . . . . . . . . . . . . . . . . Yes NoIf “Yes,” complete columns (a) through (e) below for each obligation.

(a) Date of original loan

transaction

(b) Tax year qualified

obligation first reported

(c) Amount of principal payments

made during your tax year

(d) Amount of interest payments

made during your tax year

(e) Does the loan still meet the criteria

of a qualified obligation?

Yes No

Form 3520 (2019)

Form 3520 (2019) Page 5Part III Distributions to a U.S. Person From a Foreign Trust During the Current Tax Year (continued)

29 Did you receive a Foreign Grantor Trust Beneficiary Statement from the foreign trust with respect to a distribution? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Yes No N/AIf “Yes,” attach the statement and do not complete the remainder of Part III with respect to that distribution.

If “No,” complete Schedule A with respect to that distribution. Also complete Schedule C if you enter an amount greater than zero on line 37.

30 Did you receive a Foreign Nongrantor Trust Beneficiary Statement from the foreign trust with respect to a distribution? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Yes No N/A

If “Yes,” attach the statement and complete either Schedule A or Schedule B below (see instructions). Also complete Schedule C if you enter an amount greater than zero on line 37 or line 41a.

If “No,” complete Schedule A with respect to that distribution. Also complete Schedule C if you enter an amount greater than zero on line 37.

Schedule A—Default Calculation of Trust Distributions (see instructions)31 Enter amount from line 27 . . . . . . . . . . . . . . . . . . . . . . . . . .

32 Number of years the trust has been a foreign trust (see instructions) . . . . . ▶

33 Enter total distributions received from the foreign trust during the 3 preceding tax years (or during the number of years the trust has been a foreign trust, if fewer than 3) . . . . . . . . . . . . . . . . . .

34 Multiply line 33 by 1.25 . . . . . . . . . . . . . . . . . . . . . . . . . . .

35 Average distribution. Divide line 34 by 3 (or the number of years the trust has been a foreign trust, if fewer than 3) and enter the result . . . . . . . . . . . . . . . . . . . . . . . . . . . .

36 Amount treated as ordinary income earned in the current year. Enter the smaller of line 31 or line 35. . . . .

37 Amount treated as accumulation distribution. Subtract line 36 from line 31. If -0-, do not complete the rest of Part III

38 Applicable number of years of trust. Divide line 32 by 2 and enter the result here . ▶

Schedule B—Actual Calculation of Trust Distributions (see instructions)39 Enter amount from line 27 . . . . . . . . . . . . . . . . . . . . . . . . . .

40a Amount treated as ordinary income in the current tax year . . . . . . . . . . . . . . . . .

b Qualified dividends . . . . . . . . . . . . . . . . . . . ▶

41a Amount treated as accumulation distribution. If -0-, do not complete Schedule C, Part III . . . . . . . .

b Amount of line 41a that is tax exempt . . . . . . . . . . . . . . ▶

42a Amount treated as net short-term capital gain in the current tax year . . . . . . . . . . . . . .

b Amount treated as net long-term capital gain in the current tax year . . . . . . . . . . . . . .

c 28% rate gain . . . . . . . . . . . . . . . . . . . . . ▶

d Unrecaptured section 1250 gain . . . . . . . . . . . . . . . ▶

43 Amount treated as distribution from trust corpus . . . . . . . . . . . . . . . . . . . .

44 Enter any other distributed amount received from the foreign trust not included on lines 40a, 41a, 42a, 42b, and 43 (attach explanation) . . . . . . . . . . . . . . . . . . . . . . . . . . . .

45 Amount of foreign trust’s aggregate undistributed net income . . . . . . . . . . . . . . . .

46 Amount of foreign trust’s weighted undistributed net income . . . . . . . . . . . . . . . .47 Applicable number of years of trust. Divide line 46 by line 45 and enter the result here ▶

Schedule C—Calculation of Interest Charge (see instructions)48 Enter accumulation distribution from line 37 or 41a, as applicable . . . . . . . . . . . . . . .

49 Enter tax on total accumulation distribution from line 28 of Form 4970 (attach Form 4970—see instructions) . .

50 Enter applicable number of years of foreign trust from line 38 or 47, as applicable (round to nearest half-year) . . . . . . . . . . . . . . . . . . . ▶

51 Combined interest rate imposed on the total accumulation distribution (see instructions) . . . . . . . .

52 Interest charge. Multiply the amount on line 49 by the combined interest rate on line 51 . . . . . . . .

53 Tax attributable to accumulation distributions. Add lines 49 and 52. Enter here and as “additional tax” on your income tax return . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Form 3520 (2019)

Form 3520 (2019) Page 6Part IV U.S. Recipients of Gifts or Bequests Received During the Current Tax Year From Foreign Persons

(see instructions)

54 During your current tax year, did you receive more than $100,000 that you treated as gifts or bequests from a nonresident alien (including a distribution received from a domestic trust treated as owned by a foreign person) or a foreign estate? See instructions for special rules regarding related donors . . . . . . . . . . . . . . Yes No

If “Yes,” complete columns (a) through (c) with respect to each such gift or bequest in excess of $5,000. If more space is needed, attach a statement.

(a) Date of gift or bequest

(b) Description of property received

(c) FMV of property received

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ▶ $

55 During your current tax year, did you receive more than $16,388 that you treated as gifts from a foreign corporation or a foreign partnership (including a distribution received from a domestic trust treated as owned by a foreign person)? See instructions regarding related donors . . . . . . . . . . . . . . . . . . . . . . . . . Yes NoIf “Yes,” complete columns (a) through (g) with respect to each such gift. If more space is needed, attach a statement.

(a) Date of gift

(b) Name of foreign donor

(c) Address of foreign donor

(d) Identification number,

if any

(e) Check the box that applies to the foreign donor (f)

Description of property received(g)

FMV of property receivedCorporation Partnership

56 Do you have any reason to believe that the foreign donor, in making any gift or bequest described in lines 54 and 55, was acting as a nominee or intermediary for any other person? If “Yes,” see instructions . . . . . . . . . . Yes No

Sign Here

Under penalties of perjury, I declare that I have examined this return, including any accompanying reports, schedules, or statements, and to the best of my knowledge and belief, it is true, correct, and complete.

▲

Signature

▲

Title

▲

Date

Paid Preparer Use Only

Print/Type preparer’s name Preparer’s signature Date Check if self-employed

PTIN

Firm’s name ▶

Firm’s address ▶

Firm’s EIN ▶

Phone no.

Form 3520 (2019)

Userid: CPM Schema: instrx

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2019Instructions for Form 3520Annual Return To Report Transactions With Foreign Trustsand Receipt of Certain Foreign Gifts

Department of the TreasuryInternal Revenue Service

Section references are to the Internal Revenue Code unless otherwise noted.

General InstructionsFuture DevelopmentsFor the latest information about developments related to Form 3520 and its instructions, such as legislation enacted after they were published, go to IRS.gov/Form3520.Purpose of FormU.S. persons (and executors of estates of U.S. decedents) file Form 3520 to report:• Certain transactions with foreign trusts,• Ownership of foreign trusts under the rules of sections 671 through 679, and• Receipt of certain large gifts or bequests from certain foreign persons.

A separate Form 3520 must be filed for transactions with each foreign trust.Who Must FileFile Form 3520 if any one or more of the following applies.

1. You are the responsible party for reporting a reportable event that occurred during the current tax year, or you are a U.S. person who transferred property (including cash) to a related foreign trust (or a person related to the trust) in exchange for an obligation or you hold a qualified obligation from that trust that is currently outstanding. Responsible party, reportable event, qualified obligation, and person related to a foreign trust are defined later.

Complete the identifying information on page 1 of the form and the relevant portions of Part I. See the instructions for Part I.

2. You are a U.S. person who, during the current tax year, is treated as the owner of any part of the assets of a foreign trust under the rules of sections 671 through 679.

Complete the identifying information on page 1 of the form and Part II. See the instructions for Part II. If you receive distributions from the foreign trust, you may also need to complete lines 15 through 18 of Part I if you answered “No” to line 3, and Part III. See the instructions for Parts I and III. U.S. person and owner are defined later.Note. You are required to complete Part II even if there have been no transactions involving the trust during the tax year. You may also be required to complete a substitute Form 3520-A and attach it to your Form 3520. See Penalties, later.

3. You are a U.S. person (including a U.S. owner) or an executor of the estate of a U.S. person who received (directly or indirectly) a distribution (defined later) from a foreign trust during the current tax year; or you are a U.S. person who is a U.S. owner or beneficiary of a foreign trust and in the current tax year, you or a U.S. person related to you received (1) a loan of cash or marketable securities (including an extension of credit) directly or indirectly from such foreign trust, or (2) the uncompensated use of trust property; or you are a U.S. person who is a U.S. owner or beneficiary of a foreign trust and in the current tax year such foreign trust holds an outstanding qualified obligation of yours or a U.S. person related to you. U.S. person, owner, beneficiary, and related person are defined later.

Complete the identifying information on page 1 of the form and Part III. In the case of a U.S. person that is an estate, check “Executor” on line B on page 1. If you received an amount from a portion of a foreign trust of which you are treated as the owner, please complete lines 24 and 27 in Part III. See the instructions for Part III.

4. You are a U.S. person who, during the current tax year, received either:

a. More than $100,000 from a nonresident alien individual or a foreign estate (including foreign persons related to that nonresident alien individual or foreign estate) that you treated as gifts or bequests; or

b. More than $16,388 from foreign corporations or foreign partnerships (including foreign persons related to such foreign corporations or foreign partnerships) that you treated as gifts.

Complete the identifying information on page 1 of the form and Part IV. See the instructions for Part IV.Note. You may be required to file FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR). In addition, you may be required to file Form 8938, Statement of Specified Foreign Financial Assets.Exceptions To FilingForm 3520 does not have to be filed to report the following transactions.• Transfers to foreign trusts described in section 402(b), 404(a)(4), or 404A.• Most fair market value (FMV) transfers by a U.S. person to a foreign trust. However, some FMV transfers must nevertheless be reported on Form 3520 (for example, transfers in exchange for obligations that are treated as qualified obligations, transfers of appreciated property to a foreign trust for which the U.S. transferor does not immediately recognize all of the gain on the property transferred, transfers involving a U.S. transferor that is

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related to the foreign trust). See section III of Notice 97-34, 1997-25 I.R.B. 22.• Transfers to foreign trusts that have a current determination letter from the IRS recognizing their status as exempt from income taxation under section 501(c)(3).• Transfers to, ownership of, and distributions from a Canadian registered retirement savings plan (RRSP), a Canadian registered retirement income fund (RRIF), or any other Canadian retirement plan that is within the meaning of section 3 of Rev. Proc. 2014-55. See Rev. Proc. 2014-55, 2014-44 I.R.B. 753, available at IRS.gov/irb/2014-44_IRB/ar10.html.• Deemed transfers from domestic trusts that become foreign trusts to the extent the trust is treated as owned by a foreign person, after application of section 672(f).• Distributions from foreign trusts that are taxable as compensation for services rendered (within the meaning of section 672(f)(2)(B) and its regulations), so long as the recipient reports the distribution as compensation income on its applicable federal income tax return.• Distributions from foreign trusts to domestic trusts that have a current determination letter from the IRS recognizing their status as exempt from income taxation under section 501(c)(3).Joint ReturnsIf you and your spouse are filing a joint income tax return for tax year 2019, and you are both transferors, grantors, or beneficiaries of the same foreign trust, then you may file a joint Form 3520. If you and your spouse are filing a joint Form 3520, please check the box on line 1i on page 1.Additional Reporting InformationFor more information on foreign trust reporting, including abusive foreign trust schemes, go to the IRS website at IRS.gov.When and Where To FileIn general, a U.S. person's Form 3520 is due on the 15th day of the 4th month following the end of such person's tax year for income tax purposes, which, for individuals, is April 15. If, however, on the due date of your income tax return, you are a U.S. citizen or resident who qualifies for one of the following conditions, then your Form 3520 is due on the 15th day of the 6th month (June 15) following the end of your tax year for income tax purposes. You must include a statement on the Form 3520 showing that you are a U.S. citizen or resident who meets one of these conditions.• You live outside of the United States and Puerto Rico and your place of business or post of duty is outside the United States and Puerto Rico.• You are in the military or naval service on duty outside the United States and Puerto Rico.

In the case of a Form 3520 filed with respect to a U.S. decedent, the due date to file a Form 3520 is the 15th day of the 4th month following the end of the decedent's last tax year for income tax purposes (April 15). If the U.S. person's estate is also required to file a Form 3520, the estate will have to file by the 15th day of the 4th month following the end of the estate's tax year for income tax purposes, just like any other U.S. person.

If the due date falls on a Saturday, Sunday, or legal holiday, file by the next day that is not a Saturday, Sunday, or legal holiday.Note. If a U.S. person is granted an extension of time to file an income tax return, the due date for filing Form 3520 is the 15th day of the 10th month (October 15) following the end of the U.S. person’s tax year.

Send Form 3520 to the Internal Revenue Service Center, P.O. Box 409101, Ogden, UT 84409.

Form 3520 must have all required attachments to be considered complete.Note. If a complete Form 3520 is not filed by the due date, including extensions, the time for assessment of any tax imposed with respect to any event or period to which the information required to be reported in Parts I through III of such Form 3520 relates will not expire before the date that is 3 years after the date on which the required information is reported. See section 6501(c)(8).Who Must SignIf the return is filed by:• An individual or a fiduciary, it must be signed and dated by that individual or fiduciary;• A partnership, it must be signed and dated by a general partner or limited liability company member; or• A corporation, it must be signed and dated by the president, vice president, treasurer, assistant treasurer, chief accounting officer, or any other corporate officer (such as a tax officer) who is authorized to sign.

The paid preparer must complete the required preparer information at the bottom of page 6 of Form 3520 and must be sure to:• Sign the return in the space provided for the preparer's signature, and• Give a copy of the return to the filer.Inconsistent Treatment of ItemsThe U.S. beneficiary and U.S. owner's tax return must be consistent with the Form 3520-A, Annual Information Return of Foreign Trust With a U.S. Owner, filed by the foreign trust unless you report the inconsistency to the IRS. If you are treating items on your tax return differently from the way the foreign trust treated them on its return, file Form 8082, Notice of Inconsistent Treatment or Administrative Adjustment Request (AAR). See Form 8082 for more details.PenaltiesSection 6677. A penalty applies if Form 3520 is not timely filed or if the information is incomplete or incorrect (see below for an exception if there is reasonable cause). Generally, the initial penalty is equal to the greater of $10,000 or the following (as applicable).• 35% of the gross value of any property transferred to a foreign trust for failure by a U.S. transferor to report the creation of or transfer to a foreign trust in Part I.• 35% of the gross value of the distributions received from a foreign trust for failure by a U.S. person to report receipt of the distribution in Part III.• 5% of the gross value of the portion of the foreign trust's assets treated as owned by a U.S. person under the

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grantor trust rules (sections 671 through 679) for failure by the U.S. person to report the U.S. owner information in Part II. Such U.S. person is subject to an additional separate 5% penalty (or $10,000 if greater), if such person (a) fails to ensure that the foreign trust files a timely Form 3520-A and furnishes the required annual statements to its U.S. owners and U.S. beneficiaries, or (b) does not furnish all of the information required by section 6048(b) or includes incorrect information. If a foreign trust fails to file Form 3520-A, the U.S. owner must complete and attach a substitute Form 3520-A to the U.S. owner’s Form 3520 by the due date of the U.S. owner’s Form 3520 (and not the due date for the Form 3520-A, which is otherwise due by the 15th day of the 3rd month after the end of the trust’s tax year in order to avoid being subject to the additional separate penalty for the foreign trust’s failure to file Form 3520-A. For example, a substitute Form 3520-A that, to the best of the U.S. owner’s ability, is completed and attached to the U.S. owner’s Form 3520 by the due date for the Form 3520 (such as, April 15 for U.S. owners who are individuals), is considered to be timely filed. See section 6677(a) through (c) and the instructions for Part II of this form and Form 3520-A.

Additional penalties will be imposed if the noncompliance continues for more than 90 days after the IRS mails a notice of failure to comply with the required reporting. If the IRS can determine the gross value (defined later) of the portion of the trust’s assets treated as owned by the U.S. person at the close of the tax year, then the additional penalties will be reduced as necessary to assure that the aggregate amount of such penalties do not exceed the gross value of the trust. For more information, see section 6677.

Reasonable cause. No penalties will be imposed if the taxpayer can demonstrate that the failure to comply was due to reasonable cause and not willful neglect.Note. The fact that a foreign country would impose penalties for disclosing the required information is not reasonable cause. Similarly, reluctance on the part of a foreign fiduciary or provisions in the trust instrument that prevent the disclosure of required information is not reasonable cause. See section 6677(d) for additional information.Section 6039F. In the case of a failure to timely report foreign gifts described in section 6039F, the IRS will determine the income tax consequences of the receipt of such gift, and a penalty equal to 5% of the amount of such foreign gifts applies for each month for which the failure to report continues (not to exceed a total of 25%). No penalty will be imposed if the taxpayer can demonstrate that the failure to comply was due to reasonable cause and not willful neglect. See section 6039F for additional information.Section 6662(j). If a U.S. owner of a foreign trust is subject to a penalty imposed under section 6662 for an underpayment of tax required to be shown on a return, then such penalty may be increased under section 6662(j) for any portion of an underpayment which is attributable to any transaction involving any asset with respect to which information was required to be provided on Form 3520-A. For more information about undisclosed foreign financial

asset understatements, see section 6662(j). No penalty will be imposed with respect to any portion of an underpayment if the taxpayer can demonstrate that the failure to comply was due to reasonable cause with respect to such portion of the underpayment and the taxpayer acted in good faith with respect to such portion of the underpayment. See section 6662 and section 6664(c) for additional information.DefinitionsDistributionA distribution received directly or indirectly from a foreign trust for section 6048(c) reporting purposes is any gratuitous transfer of money or other property from a foreign trust, whether or not a portion of such trust is treated as a grantor trust under the grantor trust rules of sections 671 through 679, and without regard to whether the recipient is designated as a beneficiary by the terms of the trust. A distribution includes the receipt of trust corpus and the receipt of a gift or bequest described in section 663(a).

A distribution also includes constructive transfers from a foreign trust. For example, if charges you make on a credit card are paid by a foreign trust or guaranteed or secured by the assets of a foreign trust, the amount charged will be treated as a distribution to you by the foreign trust. Similarly, if you write checks on a foreign trust's bank account, the amount will be treated as a distribution. Also, if you receive a payment from a foreign trust in exchange for property transferred to the trust or services rendered to the trust, and the FMV of the payment you received exceeds the FMV of the property transferred or services rendered, the excess will be treated as a distribution to you. See section V of Notice 97-34, 1997-25 I.R.B. 22.

Examples: 1. If you sell stock with an FMV of $100 to a foreign

trust and receive $150 in exchange, you have received a distribution of $50.

2. If you receive $100 from the trust for services performed by you for the trust, and the services have an FMV of $20, you have received a distribution of $80.

If you are a grantor or beneficiary of a foreign trust and you (or a U.S. person related to you) directly or indirectly received a loan of cash or marketable securities from a foreign trust, or you (or a U.S. person related to you) used any property owned by a foreign trust without paying FMV within a reasonable amount of time, the amount of such loan or the FMV of the use of trust property will be treated as a distribution for reporting purposes. For this purpose, a loan by an unrelated third party that is guaranteed by a foreign trust is generally treated as a loan from the trust. See section V(A) of Notice 97-34, 1997-25 I.R.B. 22.Foreign Trust and Domestic TrustA foreign trust is any trust other than a domestic trust.

A domestic trust is any trust if:1. A court within the United States is able to exercise

primary supervision over the administration of the trust, and

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2. One or more U.S. persons have the authority to control all substantial decisions of the trust.GrantorA grantor includes any person who creates a trust or directly or indirectly makes a gratuitous transfer of cash or other property to a trust. A grantor includes any person treated as the owner of any part of a foreign trust's assets under sections 671 through 679, excluding section 678.Note. If a partnership or corporation makes a gratuitous transfer to a trust, the partners or shareholders are generally treated as the grantors of the trust, unless the partnership or corporation made the transfer for a business purpose of the partnership or corporation.

If a trust makes a gratuitous transfer to another trust, the grantor of the transferor trust is treated as the grantor of the transferee trust, except that if a person with a general power of appointment over the transferor trust exercises that power in favor of another trust, such person is treated as the grantor of the transferee trust, even if the grantor of the transferor trust is treated as the owner of the transferor trust.Grantor TrustA grantor trust is any trust to the extent that the assets of the trust are treated as owned by a person other than the trust. See the grantor trust rules in sections 671 through 679. A part of the trust may be treated as a grantor trust to the extent that only a portion of the trust assets are owned by a person other than the trust.Note. Under the HIRE Act, effective after March 18, 2010, if a foreign trust directly or indirectly loans cash or marketable securities to a U.S. person who does not repay the loan at a market rate of interest, or allows a U.S. person to use trust property without paying FMV within a reasonable period of time, the trust will be treated as having a U.S. beneficiary and is therefore treated as a grantor trust under the grantor trust rules.Reporting by U.S. owners receiving distributions from foreign grantor trust. If a U.S. owner (defined later) receives (directly or indirectly) a distribution from a foreign trust of which the U.S. person is treated as the owner, the U.S. owner must only complete lines 24 and 27 in Part III.Gratuitous TransferA gratuitous transfer to a foreign trust is any transfer to the trust other than (a) a transfer for FMV; or (b) a distribution to the trust with respect to an interest held by the trust (i) in an entity other than a trust (for example, a corporation or a partnership), or (ii) in an investment trust described in Regulations section 301.7701-4(c), a liquidating trust described in Regulations section 301.7701-4(d), or an environmental remediation trust described in Regulations section 301.7701-4(e). A gratuitous transfer includes any indirect transfer that is structured with a principal purpose of avoiding the application of section 679 or 6048.

A transfer of property to a trust may be considered a gratuitous transfer without regard to whether the transfer is a gift for gift tax purposes. See chapter 12 of subtitle B of the Code (that is, sections 2501 through 2524).

For purposes of this determination, if a U.S. person contributes property to a trust in exchange for any type of interest in the trust, such interest in the trust will be disregarded in determining whether FMV has been received. In addition, a U.S. person will not be treated as making a transfer for FMV merely because the transferor is deemed to recognize gain on the transaction.

If you transfer property to a related foreign trust in exchange for an obligation of the trust (or an obligation of a person related to the trust), it will be a gratuitous transfer unless the obligation is a qualified obligation. Any transfer in exchange for an obligation (whether or not a qualified obligation) must be reported under section 6048(a). Obligation and qualified obligation are defined later. See section III.B of Notice 97-34, and the regulations under sections 679 and 684 for additional information.Gross Reportable AmountGross reportable amount is:• The gross value of property involved in the creation of a foreign trust or the transfer of property to a foreign trust (including a transfer by reason of death);• The gross value of any portion of a foreign trust treated as owned by a U.S. person under the rules of sections 671 through 679 or any part of a foreign trust that is included in the gross estate of a U.S. citizen or resident;• The gross value of the assets in a trust at the time the trust becomes a foreign trust, if the trust was a domestic trust to which a U.S. citizen or resident had previously transferred property, and provided that such U.S. citizen or resident is alive at the time the trust becomes a foreign trust (see section 679(a)(5)); or• The gross amount of distributions received from a foreign trust.Gross Value or AmountFor purposes of determining the gross reportable amount, the gross value or gross amount of property is the value of property as determined under section 2512 and its regulations, without regard to any prohibitions or restrictions on a person's interest in the property. See section VII of Notice 97-34. Although formal appraisals are not generally required, you should keep contemporaneous records of how you arrived at your good faith estimate.GuaranteeA guarantee:• Includes any arrangement under which a person, directly or indirectly, assures, on a conditional or unconditional basis, the payment of another's obligation;• Encompasses any form of credit support, and includes a commitment to make a capital contribution to the debtor or otherwise maintain its financial viability; or• Includes an arrangement reflected in a “comfort letter,” regardless of whether the arrangement gives rise to a legally enforceable obligation. If an arrangement is contingent upon the occurrence of an event, in determining whether the arrangement is a guarantee, you must assume that the event has occurred.

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Nongrantor TrustA nongrantor trust is any trust to the extent that the assets of the trust are not treated as owned by a person other than the trust under the grantor trust rules in sections 671 through 679. Thus, a nongrantor trust is treated as a taxable entity. A trust may be treated as a nongrantor trust with respect to only a portion of the trust assets. See Grantor Trust, earlier.ObligationAn obligation includes any bond, note, debenture, certificate, bill receivable, account receivable, note receivable, open account, or other evidence of indebtedness, and, to the extent not previously described, any annuity contract.OwnerAn owner of a foreign trust is the person that is treated as owning any of the assets of a foreign trust under the rules of sections 671 through 679.PropertyProperty means any property, whether tangible or intangible, including cash.Qualified ObligationA qualified obligation, for purposes of this form, is any obligation only if:

1. The obligation is reduced to writing by an express written agreement;

2. The term of the obligation does not exceed 5 years (including options to renew and rollovers);

3. All payments on the obligation are denominated in U.S. dollars;

4. The yield to maturity of the obligation is not less than 100% of the applicable federal rate under section 1274(d) for the day on which the obligation is issued and not greater than 130% of the applicable federal rate;

5. The U.S. person agrees to extend the period for assessment of any income or transfer tax attributable to the transfer and any consequential income tax changes for each year that the obligation is outstanding to a date not earlier than 3 years after the maturity date of the obligation, unless the maturity date of the obligation does not extend beyond the end of the U.S. person's tax year and is paid within such period (this is done on Part I, Schedule A, line 12, and Part III, line 26, as applicable); and

6. The U.S. person reports the status of the obligation, including principal and interest payments, on Part I, Schedule C, line 19, and Part III, line 28, as applicable, for each year that the obligation is outstanding.Related PersonA related person generally includes any person who is related to you for purposes of sections 267 and 707(b). This includes, but is not limited to:• A member of your family—your brothers and sisters, half-brothers and half-sisters, spouse, ancestors (parents, grandparents, etc.), lineal descendants (children,

grandchildren, etc.), and the spouses of any of these persons; or• A corporation in which you, directly or indirectly, own more than 50% in value of the outstanding stock.

See section 643(i)(2)(B) and the regulations under sections 267 and 707(b).Person related to a foreign trust. A person is related to a foreign trust if such person, without regard to the transfer at issue, is a grantor of the trust, a beneficiary of the trust, or is related to any grantor or beneficiary of the trust. See the definition of related person above.Reportable EventA reportable event includes the following.

1. The creation of a foreign trust by a U.S. person.2. The transfer of any money or property, directly or

indirectly, to a foreign trust by a U.S. person, including a transfer by reason of death. This includes transfers that are deemed to have occurred under sections 679(a)(4) and (5).

3. The death of a citizen or resident of the United States if:• The decedent was treated as the owner of any portion of a foreign trust under the rules of sections 671 through 679, or• Any portion of a foreign trust was included in the gross estate of the decedent.Responsible PartyResponsible party means:• The grantor in the case of the creation of an inter vivos trust;• The transferor, in the case of a reportable event (defined above) other than a transfer by reason of death; or• The executor of the decedent's estate in any other case (whether or not the executor is a U.S. person).U.S. AgentA U.S. agent is a U.S. person (defined later) that has a binding contract with a foreign trust that allows the U.S. person to act as the trust's authorized U.S. agent in applying sections 7602, 7603, and 7604 with respect to:• Any request by the IRS to examine records or produce testimony related to the proper U.S. tax treatment of amounts distributed, or required to be taken into account under the rules of sections 671 through 679, with respect to a foreign trust; or• Any summons by the IRS for such records or testimony.

A U.S. grantor, a U.S. beneficiary, or a domestic corporation controlled by the grantor or beneficiary may act as a U.S. agent. However, you may not treat the foreign trust as having a U.S. agent unless you enter the name, address, and taxpayer identification number (TIN) of the U.S. agent on lines 3a through 3g on page 1 of the form. See Identification numbers, later.

If the person identified as the U.S. agent does not produce records or testimony when requested or summoned by the IRS, the IRS may redetermine the

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amounts required to be taken into account with respect to the foreign trust by the U.S. owner. See section6048(b)(2).

The agency relationship must be established by the time the U.S. person files Form 3520 for the relevant tax year and must continue as long as the statute of limitations remains open for the relevant tax year. If the agent's responsibility as an agent of the trust is terminated for any reason (for example, agent's resignation, agent's liquidation, or agent's death), see section IV(B) of Notice 97-34.

In order to authorize a U.S. person to act as an agent for purposes of section 6048(b)(2) or for purposes of section 6048(c)(2)(A), the trust and the agent must enter into a binding agreement substantially in the format reflected under AUTHORIZATION OF AGENT in the Instructions for Form 3520-A, amended as required. Attach a copy of the authorization to Form 3520.U.S. BeneficiaryA U.S. beneficiary generally includes any U.S. person that could possibly benefit (directly or indirectly) from the trust (including an amended trust) at any time, whether or not the person is designated in the trust instrument as a beneficiary and whether or not the person can receive a distribution from the trust in the current year. In addition, a U.S. beneficiary includes:• A foreign corporation that is a controlled foreign corporation (as defined in section 957(a)),• A foreign partnership if a U.S. person is a partner of the partnership, and• A foreign estate or trust if the estate or trust has a U.S. beneficiary. See Section II of Notice 97-34 and the regulations under section 679 for additional information.Foreign trust treated as having a U.S. beneficiary. In general, a foreign trust will be treated as having a U.S. beneficiary unless the terms of the trust instrument specifically prohibit any distribution of income or corpus to a U.S. person at any time, even after the death of the U.S. transferor or any event terminating the trust, and the trust cannot be amended or revised to allow such a distribution. For these purposes, an amount will be treated as accumulated for the benefit of a U.S. person even if the U.S. person's interest in the trust is contingent on a future event and regardless of whether anything is actually distributed to a U.S. person during that tax year.

Special rule in case of discretion to identify beneficiaries. For purposes of the general rule described earlier, if any person has the discretion of making a distribution from the trust to, or for the benefit of, any person, the trust will be treated as having a beneficiary who is a U.S. person unless the terms of the trust specifically identify the class of persons to whom such distributions may be made, and none of those persons are U.S. persons during the tax year.

Certain agreements and understandings treated as terms of the trust. For purposes of the general rule described earlier, if any U.S. person who directly or indirectly transfers property to the trust is directly or indirectly involved in any agreement or understanding (whether written, oral, or otherwise) that may result in the income or corpus of the trust being paid or accumulated to

or for the benefit of a U.S. person, such agreement or understanding will be treated as a term of the trust.

Certain loans or uncompensated use of trust property. If a foreign trust is not already treated as having a U.S. beneficiary under the rules described earlier and above, the trust will be treated as having a U.S. beneficiary if, after March 18, 2010, either:• The foreign trust loans cash or marketable securities directly or indirectly to a U.S. person and the U.S. person does not repay the loan at a market rate of interest within a reasonable period of time; or• A U.S. person, directly or indirectly, uses property that is owned by the foreign trust and does not pay FMV of the use of such property within a reasonable period of time.Presumption that foreign trust has U.S. beneficiary. For transfers of property after March 18, 2010, if a U.S. person directly or indirectly transfers property to a foreign trust (other than a deferred compensation or charitable trust described in section 6048(a)(3)(B)(ii)), the IRS may treat such trust as having a U.S. beneficiary for purposes of applying section 679(d) to such transfer if the IRS requests information with respect to the transfer and the U.S. person fails to demonstrate to the satisfaction of the IRS that no portion of the income or corpus of the trust may ever be paid to or accumulated for the benefit of a U.S. person.U.S. PersonA U.S. person is:• A citizen or resident alien of the United States (see Pub. 519, U.S. Tax Guide for Aliens, for guidance on determining resident alien status),• A domestic partnership,• A domestic corporation,• Any estate (other than a foreign estate, within the meaning of section 7701(a)(31)(A)), and• Any domestic trust (defined earlier).U.S. TransferorA U.S. transferor is any U.S. person who:

1. Creates or settles a foreign trust;2. Directly or indirectly transfers money or property to

a foreign trust (this includes deemed transfers under section 679(a)(4) or section 679(a)(5));

3. Makes a sale to a foreign trust if the sale was at other than arm's-length terms or was to a related foreign trust, or makes (or guarantees) a loan to a related foreign trust; or

4. Is the executor of the estate of a U.S. person and:a. The decedent made a testamentary transfer (a

transfer by reason of death) to a foreign trust;b. Immediately prior to death, the decedent was

treated as the owner of any portion of a foreign trust under the rules of sections 671 through 679; or

c. Any portion of a foreign trust's assets were included in the estate of the decedent.

Generally, the person defined as the transferor is the responsible party (defined earlier) who must ensure that required information be provided or pay appropriate penalties.

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Specific InstructionsPeriod CoveredFile the 2019 return for calendar year 2019 and fiscal years that begin in 2019 and end in 2020. For a fiscal year, fill in the tax year in the space at the top of the form.Item A—Initial Return, Initial Return on Extension, Final Return, Amended ReturnInitial return. If this is the initial return you are filing concerning the foreign trust identified, check the “Initial return” box.Initial return on extension. If this is the initial return you are filing concerning the foreign trust identified and you have filed an extension with respect to your income tax return, check the “Initial return (extension filed)” box.Final return. If no further returns for transactions with the foreign trust are required, check the “Final return” box.

Example. If you annually filed Form 3520 and completed Part II because you were the owner of the trust for U.S. income tax purposes and the trust has terminated within the tax year, that year's return would be a final return with respect to that foreign trust.Amended return. If this Form 3520 is filed to amend a Form 3520 that you previously filed for the same tax year, check the “Amended return” box.Item C—Excepted Specified Foreign Financial Assets ReportedCheck the box in Item C only if the Form 3520 filer also files Form 8938, Statement of Specified Foreign Financial Assets, for the tax year and includes this form in the total number of Forms 3520 reported on line 1 of Part IV, Excepted Specified Foreign Financial Assets, of Form 8938. For more information, see the Instructions for Form 8938, generally, and in particular, Duplicative Reporting and the specific instructions for Part IV.Identifying InformationIdentification numbers. Use social security numbers or individual taxpayer identification numbers to identify individuals. Use employer identification numbers (EINs) to identify estates, trusts, partnerships, and corporations.

Do not enter a preparer tax identification number (PTIN) in any entry space on Form 3520 other than the entry space for “PTIN” at the bottom of

page 6 of the form.Address. Include the room, suite, or other unit number after the street address. If the post office does not deliver mail to the street address and the U.S. person has a P.O. box, show the box number instead.Foreign address. Do not abbreviate the country name.Line 1a and line 1i. Line 1a identifies the person that is filing Form 3520. If you and your spouse are filing a joint Form 3520, put your names and taxpayer identification

CAUTION!

numbers in the same order as they appear on your Form 1040, U.S. Individual Income Tax Return, or Form 1040-SR, U.S. Tax Return for Seniors, and check the box on line 1i.Line 1j. Generally, enter the name of the Service Center where you file your income tax return in the entry space provided on line 1j on page 1 of the form.

However, if you are an executor filing a Form 3520 with respect to a U.S. decedent, provide both the name of the Service Center where the decedent's final income tax return will be filed, and the name of the Service Center where Form 706 will be filed, if applicable. Please enter the information as follows. First enter the name of the Service Center where the decedent's final income tax return will be filed. Then, if applicable, enter the name of the Service Center where Form 706 will be filed, followed by “(estate tax return).”Note. If your income tax return is filed electronically, enter “e-filed” in lieu of the name of the Service Center.Line 1k. If you filed for an extension of time to file your income tax return, check the box on line 1k. Also, enter the tax form number of the original tax return that will be filed with the IRS.

Example. You file Form 4868, Application for Automatic Extension of Time To File U.S. Individual Income Tax Return, to extend the time to file your individual income tax return, Form 1040. Enter “1040” on the entry line.Line 2b(2). A reference ID number is required on line 2b(2) only in cases where the foreign trust has no EIN. However, filers are permitted to enter both an EIN on line 2b(1) and a reference ID number on line 2b(2). If applicable, enter the reference ID number (defined below) you have assigned to the foreign trust.

For Form 3520 purposes, a “reference ID number” with respect to the foreign trust is a number established with respect to the foreign trust by or on behalf of the U.S. person that is engaged in a transaction with such foreign trust with respect to which Form 3520 reporting is required. There is no need to apply to the IRS to request a reference ID number or for permission to use such number. This number is used to uniquely identify the foreign trust in order to keep track of the trust from tax year to tax year only on Form 3520 (and on any other form that is attached to or associated with Form 3520, including the Form 3520-A in the case of a U.S. owner of the foreign trust) and should not be used with respect to the foreign trust on other IRS forms. The reference ID number must meet the requirements set forth below.Note. A reference ID number should only be provided with respect to the foreign trust if you are completing Part I, II, or III of the form. The reference ID number is not necessary if you are completing Part IV of the form.Requirements. The reference ID number must be alphanumeric (defined below) and no special characters are permitted. The length of a given reference ID number is limited to 50 characters.

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For these purposes, the term “alphanumeric” means the entry can be alphabetical, numeric, or any combination of the two.

The same reference ID number must be used consistently from tax year to tax year with respect to a given foreign trust. If for any reason a reference ID number is not being used (for example, the foreign trust is terminated and no longer exists), the reference ID number used for that foreign trust cannot be used again for another foreign trust for purposes of Form 3520 reporting.

There are some situations that warrant correlation of a new reference ID number with a previous reference ID number when assigning a new reference ID number to a foreign trust.

For example, in the case of a trust that has received assets from another trust, a Form 3520 filer must use a reference ID number for the receiving trust which correlates the previous reference ID number for the distributing trust with the new reference ID number assigned to the receiving foreign trust.

You must correlate the reference ID numbers as follows: New reference ID number, Old reference ID number. If there is more than one old reference ID number, you must enter a space between each such number. As indicated above, the length of a given reference ID number is limited to 50 characters and each number must be alphanumeric and no special characters are permitted.Note. This correlation requirement applies only to the first year the new reference ID number is used.Lines 4a through 4f. If you are the executor of the estate of a U.S. citizen or resident, you must provide information about the decedent on lines 4a through 4e. You must also check the applicable box on line 4f to indicate which of the following applies: the U.S. decedent made a transfer to a foreign trust by reason of death, the U.S. decedent was treated as the owner of a portion of a foreign trust immediately prior to death, or the estate of the U.S. decedent included assets of a foreign trust.Part I—Transfers by U.S. Persons to a Foreign Trust During the Current Tax YearComplete Part I for information on a reportable event (defined earlier).Note. Although the basic reporting requirements for Form 3520 are contained in section 6048 (and are clarified by Notice 97-34), the reporting requirements have been clarified by the regulations under sections 679 and 684. Accordingly, the regulations under sections 679 and 684 should be referred to for additional clarification for transfers that are required to be reported in Part I of Form 3520.Line 5a. Enter the name of the trust creator. If you are the trust creator, enter "Same as line 1a" on line 5a. If you are not the trust creator, enter the name of the person who created or originally settled the foreign trust.

Lines 5b and 5c. Enter the address and identification number, if any, of the trust creator. See Identifying Information, earlier, for specific information regarding the entering of addresses and identification numbers on Form 3520. If you are the trust creator, enter "Same as lines 1c, 1e, 1f, 1g, and 1h" on line 5b, and enter "Same as line 1b" on line 5c.Lines 6a and 6b. Enter the applicable two-letter country code from the list at IRS.gov/CountryCodes.Lines 7 and 8. If you are reporting multiple transfers to a single foreign trust and the answers to line 7 or 8 are different for various transfers, complete a separate line for each transfer on duplicate copies of the relevant pages of the form.Line 7a and b. Check “Yes” if you are treated as a U.S. owner of any portion of the foreign trust under the grantor trust rules (sections 671 through 679) and complete line 7b and Part II. In addition, if another person is treated as an owner of the transferred assets, you must comply with the reporting requirements that would apply to a direct transfer to that other person. For example, if that other person is a foreign partnership, you must comply with the reporting requirements for transfers to foreign partnerships. See Form 8865, Return of U.S. Persons With Respect to Certain Foreign Partnerships.Line 8. If the transfer was a completed gift (see Regulations section 25.2511-2), you may have to file Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return. If the transfer was a bequest, you may have to file Form 706.Line 9. See U.S. Beneficiary, earlier.Schedule A—Obligations of a Related TrustComplete the applicable portions of Schedule A with respect to all transfers to a related foreign trust in exchange for an obligation of the trust or a person related to the trust that took place during the current tax year.Line 11. For additional information, see Obligation, Qualified Obligation, and Person related to a foreign trust, earlier.Line 12. If you answered "Yes" to the question on line 11b with respect to any obligation, you must generally answer “Yes” to the question on line 12. By so doing, you agree to extend the period of assessment of any income or transfer tax attributable to the transfer and any consequential income tax changes for each year that the obligation is outstanding to a date 3 years after the maturity date of the obligation. You have the right to refuse to extend the period of assessment. Pub. 1035, Extending the Tax Assessment Period, provides a more detailed explanation of your rights and the consequences of the choices you may make. When executed and filed, this form will be deemed to be agreed upon and executed by the IRS for purposes of Regulations section 301.6501(c)-1(d).Note. If you answer “No” to the question on line 12, you generally may not treat an obligation as a qualified obligation on line 11b. The one exception to this is if the maturity date of the obligation does not extend beyond the

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end of your tax year for which you are reporting and such obligation is paid within that tax year.Schedule B—Gratuitous TransfersComplete the applicable portions of Schedule B with respect to all reportable events (defined earlier) that took place during the current tax year.Line 13. • In your column (b) description, indicate whether the property is tangible or intangible.• You may aggregate transfers of cash during the year on a single line of line 13.• If there is not enough space on the form, please attach a statement.• For transfers reported on statements, you must enter “Statement” on one of the lines in column (b), and enter the total amount of transfers reported on the statement on line 13, columns (c), (d), (e), (f), (h), and (i).Note. Penalties may be imposed for failure to report all required information. See Penalties, earlier.Line 13, column (d). Enter the U.S. adjusted basis of the property transferred.Line 13, column (e). Only include gain that is immediately recognized at the time of the transfer.Note. Any transfer of appreciated assets by a U.S. person to a foreign nongrantor trust is treated as a sale or exchange and the transferor must recognize as a gain the excess of the FMV of the transferred property over its adjusted basis. This rule applies to a domestic trust that becomes a foreign trust, provided that the foreign trust is not a grantor trust. The domestic trust is treated as having transferred all of its assets to the foreign trust immediately prior to becoming a foreign trust. Although the gain is not recognized on Form 3520, it must be reported on the appropriate form or schedule of the transferor's income tax return. See section 684. The transfer of assets, however, is reported on Part I of this Form 3520.Line 13, column (f). Generally, if the reported transaction is a sale, you should report the gain on the appropriate form or schedule of your income tax return.Lines 15 through 18. If you checked “No” on line 3, acknowledging that the foreign trust did not appoint a U.S. agent who can provide the IRS with all relevant trust information, complete lines 15 through 18.Line 15. Enter the name, address, whether the person is a U.S. beneficiary (defined earlier), and TIN, if any, of all reportable beneficiaries. Include specified beneficiaries, classes of discretionary beneficiaries, and names or classes of any beneficiaries that could be named as additional beneficiaries. If there is not enough space on the form, attach a statement.Line 17. Enter the name, address, and TIN, if any, of any person, other than those listed on line 16, that has significant powers over the trust (for example, “protectors,” “enforcers,” any person that must approve trustee decisions or otherwise direct trustees, any person with a power of appointment, any person with powers to remove or appoint trustees, etc.). Include a description of

each person's powers. If there is not enough space, attach a statement.Line 18. Attach a copy of the following documents. If these documents have been previously attached to a Form 3520-A or Form 3520 filed within the previous 3 years, attach only relevant updates.• A summary of the terms of the trust that includes a summary of any oral agreements or understandings you have with the trustee, whether or not legally enforceable.• A copy of all trust documents (and any revisions), including the trust instrument, any memoranda of wishes prepared by the trustees summarizing the settlor's wishes, any letter of wishes prepared by the settlor summarizing his or her wishes, and any similar documents.• A copy of the trust's financial statements, including a balance sheet and an income statement similar to those shown on Form 3520-A. These financial statements must reasonably reflect the trust's accumulated income under U.S. income tax principles. For example, the statements must not treat capital gains as additions to trust corpus.Schedule C—Qualified Obligations Outstanding in the Current Tax YearLine 19. Provide information on the status of outstanding obligations of the related foreign trust (or an obligation of a person related to the foreign trust) that you reported as a qualified obligation in the current tax year. This information is required in order to retain the obligation's status as a qualified obligation. If relevant, attach a statement describing any changes in the terms of the qualified obligation.

If the obligation fails to retain the status of a qualified obligation, you will be treated as having made a gratuitous transfer to the foreign trust, which must be reported on Schedule B of this Part I in the year the obligation fails to meet the criteria for a qualified obligation. See section III(C)(2) of Notice 97-34.Part II—U.S. Owner of a Foreign TrustComplete Part II if you are considered the owner of any assets of a foreign trust under the rules of sections 671 through 679 during the tax year. You are required to enter a TIN for such foreign trust on line 2b(1) or line 2b(2) on page 1 of the form.Note. You are required to complete Part II even if there have been no transactions involving the trust during the tax year. You may also need to complete Part III if you receive a distribution from the foreign trust. See the instructions for Part III.Line 20. Enter information regarding any person, including yourself, who is considered the owner of any portion of the trust under the rules of sections 671 through 679. Also, enter in column (e) the specific Code section that causes you and any other person (as applicable) to be considered an owner for U.S. income tax purposes. See the grantor trust rules under sections 671 through 679.Line 21. In columns (a) and (b), enter the applicable two-letter code from the list at IRS.gov/CountryCodes.

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Line 22. If “Yes,” the copy of the Foreign Grantor Trust Owner Statement (pages 3 and 4 of Form 3520-A) should show the amount of the foreign trust's income that is attributable to you for U.S. income tax purposes. See section IV of Notice 97-34.

If “No,” to the best of your ability, complete and attach a substitute Form 3520-A for the foreign trust to your Form 3520 by the due date of your Form 3520 (and not the due date for the Form 3520-A). Otherwise, you may be liable for a penalty equal to the greater of $10,000 or 5% of the gross value of the portion of trust assets that you are treated as owning. There are additional penalties for continuing failure to file after notice by the IRS. See section 6677(a) through (c). Also see Penalties, earlier.Line 23. Enter the FMV of the trust assets that you are treated as owning. Include all assets at FMV as of the end of the tax year. For this purpose, disregard all liabilities. The trust should send you this information in connection with its Form 3520-A. If you did not receive such information (line 9 of the Foreign Grantor Trust Owner Statement) from the trust, complete line 23 to the best of your ability. At a minimum, include the value of all assets that you have transferred to the trust. Also, use Form 8082 to notify the IRS that you did not receive a Foreign Grantor Trust Owner Statement. However, filing Form 8082 does not relieve you of any penalties that may be imposed under section 6677. See Penalties, earlier.Part III—Distributions to a U.S. Person From a Foreign Trust During the Current Tax YearIf you received an amount from a portion of a foreign trust of which you are treated as the owner, please complete lines 24 and 27 in Part III. If you received an amount from a foreign trust that would require a report under both Parts III and IV (gifts or bequests) of Form 3520, report the amount only in Part III.Line 24. Report any cash or the FMV of other property that you received (actually or constructively, directly or indirectly) from a foreign trust during the current tax year, whether or not taxable, unless the amount is a loan to you from the trust or constitutes uncompensated use of trust property, both of which must be reported on line 25. For example, if you are a partner in a partnership that receives a distribution from a foreign trust, you must report your allocable share of such payment as an indirect distribution from the trust.

Line 24, column (c). The filer is permitted to enter the basis of the property in the hands of the beneficiary (as determined under section 643(e)(1)), if lower than the FMV of the property, but only if the taxpayer is not required to complete Schedule A (lines 31 through 38) due to lack of documentation. For these purposes, lack of documentation refers to a situation in which the filer checked “No” on line 29 or 30 because (a) the beneficiary did not receive a Foreign Grantor Trust Beneficiary Statement or a Foreign Nongrantor Trust Beneficiary Statement from the trust, or (b) such statement did not contain all six of the items specified under the instructions for line 29 or 30, later.

Line 25. If you or a U.S. person related to you received a loan of cash or marketable securities, directly or indirectly, from a related foreign trust, or the uncompensated use of trust property, the amount of such loan or the FMV of the use of trust property will be treated as a reportable distribution, whether or not taxable. For this purpose, a loan to you by an unrelated third party that is guaranteed by a foreign trust is generally treated as a loan from the trust.

Line 25, column (e). Answer “Yes” if an obligation given in exchange for the loan is a qualified obligation (defined earlier).

Line 25, column (f). The FMV of an obligation is zero unless it is a qualified obligation. Therefore, in the case of obligations that are not qualified obligations, enter “-0-” in column (f).

Uncompensated use of trust property. If you or a U.S. person related to you, directly or indirectly, used any property of a foreign trust, the FMV of such use will be treated as a reportable distribution whether or not taxable. Report the FMV of the use of trust property in column (a) and the date of first use in column (b), skip columns (c) through (e), report the amount paid for such use in column (f), and enter the amount treated as a taxable distribution from the trust in column (g) by subtracting column (f) from column (a). See section 643(i) for more information.Note. Under the HIRE Act, effective after March 18, 2010, if a foreign trust with a U.S. transferor is not already treated as a grantor trust under the rules of sections 671 through 679, the foreign trust will be treated as having acquired a U.S. beneficiary, and will therefore be treated as a grantor trust, if it makes a loan of cash or marketable securities, directly or indirectly, to a U.S. person or allows a U.S. person, directly or indirectly, to use trust property, and the U.S. person does not repay the loan at a market rate of interest or pay the trust the FMV of the use of the property within a reasonable period of time. Accordingly, the loan or use of trust property will not be treated as a taxable distribution under section 643(i) but will remain reportable on Part III of this Form 3520.Line 26. See Line 12, earlier, except that “line 25, column (e)” should replace “line 11b,” and “line 26” should replace “line 12.”Line 27. Penalties may be imposed for failure to accurately report all distributions received during the current tax year. See Penalties, earlier.Line 28. Provide information on the status of any outstanding obligation to the foreign trust that you reported as a qualified obligation in the current tax year. This information is required in order to retain the obligation's status as a qualified obligation. If relevant, attach a statement describing any changes to the terms of the qualified obligation. If the obligation fails to retain the status of a qualified obligation, you will be treated as having received a taxable distribution under section 643(i) from the foreign trust. See section V(A) of Notice 97-34.Lines 29 and 30. If any of the six items required for the Foreign Grantor Trust Beneficiary Statement (see Line 29 below) or for the Foreign Nongrantor Trust Beneficiary

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Statement (see Line 30 below) is missing, you must check “No” on line 29 or line 30, as applicable.

Also, if you answer “Yes” to line 29 or line 30, and the foreign trust or U.S. agent does not produce records or testimony when requested or summoned by the IRS, the IRS may redetermine the tax consequences of your transactions with the trust and impose appropriate penalties under section 6677.Note. If the question on line 29 or 30 is not applicable, check the “N/A” box.Line 29. If “Yes,” attach the Foreign Grantor Trust Beneficiary Statement (page 5 of Form 3520-A) from the foreign trust and do not complete the rest of Part III with respect to the distribution. If a U.S. beneficiary receives a complete Foreign Grantor Trust Beneficiary Statement with respect to a distribution during the tax year, the beneficiary should treat the distribution for income tax purposes as if it came directly from the owner. For example, if the distribution is a gift, the beneficiary should not include the distribution in gross income.

In addition to basic identifying information (that is, name, address, TIN, etc.) about the foreign trust and its trustee, this statement must contain these items.

1. The first and last day of the tax year of the foreign trust to which this statement applies.

2. An explanation of the facts necessary to establish that the foreign trust should be treated for U.S. tax purposes as owned by another person. (The explanation should identify the Code section that treats the trust as owned by another person.)

3. A statement identifying whether the owner of the trust is an individual, trust, corporation, or partnership.

4. A description of property (including cash) distributed or deemed distributed to the U.S. person during the tax year, and the FMV of the property distributed.

5. A statement that the trust will permit either the IRS or the U.S. beneficiary to inspect and copy the trust's permanent books of account, records, and such other documents that are necessary to establish that the trust should be treated for U.S. tax purposes as owned by another person. This statement is not necessary if the trust has appointed a U.S. agent.

6. A statement as to whether the foreign trust has appointed a U.S. agent (defined earlier). If the trust has a U.S. agent, include the name, address, and TIN of the agent.Line 30. If “Yes,” attach the Foreign Nongrantor Trust Beneficiary Statement from the foreign trust. A Foreign Nongrantor Trust Beneficiary Statement must include the following items.

1. An explanation of the appropriate U.S. tax treatment of any distribution or deemed distribution for U.S. tax purposes, or sufficient information to enable the U.S. beneficiary to establish the appropriate treatment of any distribution or deemed distribution for U.S. tax purposes.

2. A statement identifying whether any grantor of the trust is a partnership or a foreign corporation. If so, attach an explanation of the relevant facts.

3. A statement that the trust will permit either the IRS or the U.S. beneficiary to inspect and copy the trust's permanent books of account, records, and such other documents that are necessary to establish the appropriate treatment of any distribution or deemed distribution for U.S. tax purposes. This statement is not necessary if the trust has appointed a U.S. agent.

4. The Foreign Nongrantor Trust Beneficiary Statement must also include items (1), (4), and (6), as listed in the line 29 instructions above, as well as basic identifying information (for example, name, address, TIN, etc.) about the foreign trust and its trustee.Schedule A—Default Calculation of Trust DistributionsIf you answered “Yes” to line 30, you may complete either Schedule A or Schedule B. Generally, however, if you complete Schedule A in the current year (or did so in the prior years), you must continue to complete Schedule A for all future years, even if you are able to answer “Yes” to line 30 in that future year. (The only exception to this consistency rule is that you may use Schedule B in the year that a trust terminates, but only if you are able to answer “Yes” to line 30 in the year of termination.)Line 32. To the best of your knowledge, state the number of years the trust has been in existence as a foreign trust and attach an explanation of your basis for this statement. Consider any portion of a year to be a complete year. If this is the first year that the trust has been a foreign trust, do not complete the rest of Part III (you do not have an accumulation distribution).Line 33. Enter the total amount of distributions that you received during the 3 preceding tax years (or the number of years the trust has been a foreign trust if fewer than 3). For example, if a trust distributed $50 in year 1, $120 in year 2, and $150 in year 3, the amount reported on line 33 would be $320 ($50 + $120 + $150).Line 35. Divide line 34 by 3 (or the number of years the trust has been a foreign trust if fewer than 3). Consider any portion of a year to be a complete year. For example, a foreign trust created on July 1, 2017, would be treated on a 2019 calendar year return as having 2 preceding years (2017 and 2018). In this case, you would calculate the amount on line 35 by dividing line 34 by 2. Do not disregard tax years in which no distributions were made. The IRS will consider your proof of these prior distributions as adequate records to demonstrate that any distribution up to the amount on line 31 is not an accumulation distribution in the current tax year.Line 36. Enter this amount as ordinary income on your tax return. Report this amount on the appropriate schedule of your tax return (for example, Schedule E (Form 1040 or 1040-SR), Part III).Note. If there is an amount on line 37, you must also complete line 38 and Schedule C—Calculation of Interest Charge to determine the amount of any interest charge you may owe.

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Schedule B—Actual Calculation of Trust DistributionsYou may only use Schedule B if:• You answered “Yes” to line 30,• You attach a copy of the Foreign Nongrantor Trust Beneficiary Statement to this return, and• You have never before used Schedule A for this foreign trust or this foreign trust terminated during the tax year.Line 40a. Enter on line 40a the amount received by you from the foreign trust that is treated as ordinary income of the trust in the current tax year. Ordinary income is all income that is not capital gains. Report this amount on the appropriate schedule of your tax return (for example, Schedule E (Form 1040 or 1040-SR), Part III).Lines 42a through 42d. Enter on these lines the applicable amounts received by you from the foreign trust that are treated as capital gain income of the trust in the current tax year. Report these amounts on the appropriate schedule of your tax return (for example, Schedule D (Form 1040 or 1040-SR)).Line 45. Enter the foreign trust's aggregate undistributed net income (UNI). For example, assume that a trust was created in 2013 and has made no distributions prior to 2019. Assume the trust's ordinary income was $0 in 2018, $60 in 2017, $124 in 2016, $87 in 2015, $54 in 2014, and $25 in 2013. Thus, for 2019, the trust's UNI would be $350. If the trust earned $100 and distributed $200 during 2019 (so that $100 was distributed from accumulated earnings), the trust's 2020 aggregate UNI would be $250 ($350 + $100 − $200).Line 46. Enter the foreign trust's weighted undistributed net income (weighted UNI). The trust's weighted UNI is its accumulated income that has not been distributed, weighted by the years that it has accumulated income. To calculate weighted UNI, multiply the undistributed income from each of the trust's years by the number of years since that year, and then add each year's result. Using the example from line 45, the trust's weighted UNI in 2019 would be $1,260, calculated as follows.

Year

No. of years

since that year

UNI from each year Weighted UNI

2018 1 $ 0 $ 02017 2 60 1202016 3 124 3722015 4 87 3482014 5 54 2702013 6 25 150TOTAL $350 $1,260

To calculate the trust's weighted UNI for the following year (2020), the trust could update this calculation, or the weighted UNI shown on line 46 of the 2019 Form 3520 could simply be updated using the following steps.

1. Begin with the 2019 weighted UNI.2. Add UNI at the beginning of 2019.3. Add trust earnings in 2019.

4. Subtract trust distributions in 2019.5. Subtract weighted trust accumulation distributions

in 2019. (Weighted trust accumulation distributions are the trust accumulation distributions in 2019 multiplied by the applicable number of years from 2019.)

Using the example above, the trust's 2020 weighted UNI would be $1,150, calculated as follows.

2019 weighted UNI . . . . . . . . . . . . . . . . . . . . . $1,260UNI at beginning of 2019 . . . . . . . . . . . . . . . . . + 350Trust earnings in 2019 . . . . . . . . . . . . . . . . . . . + 100Trust distributions in 2019 . . . . . . . . . . . . . . . . − 200Weighted trust accumulation distributions in 2019

($100 X 3.6) . . . . . . . . . . . . . . . . . . . . . . . – 3602020 weighted UNI . . . . . . . . . . . . . . . . . . . . . $1,150

Line 47. Calculate the trust's applicable number of years by dividing line 46 by line 45. This would be the weighted UNI divided by the annual UNI. Using the examples in the instructions for lines 45 and 46, the trust's applicable number of years would be 3.6 in 2019 (1,260/350) and 4.6 in 2020 (1,150/250).Note. Include as many decimal places as there are digits in the UNI on line 45 (for example, using the example in the instructions for line 45, include three decimal places).Schedule C—Calculation of Interest ChargeComplete Schedule C if you entered an amount on line 37 or line 41a.Line 49. Include the amount from line 48 of this form on line 1 of Form 4970, Tax on Accumulation Distribution of Trusts. Then compute the tax on the total accumulation distribution using lines 1 through 28 of Form 4970. Enter on line 49 the tax from line 28 of Form 4970.Note. Use Form 4970 as a worksheet and attach it toForm 3520.Line 51. Interest accumulates on the tax (line 49) for the period beginning on the date that is the applicable number of years (as rounded on line 50) prior to the applicable date and ending on the applicable date. For purposes of making this interest calculation, the applicable date is the date that is mid-year through the tax year for which reporting is made (for example, in the case of a 2019 calendar-year taxpayer, the applicable date would be June 30, 2019). Alternatively, if you received only a single distribution during the tax year that is treated as an accumulation distribution, you may use the date of that distribution as the applicable date.

For portions of the interest accumulation period that are prior to 1996 (and after 1976), interest accumulates at a simple rate of 6% annually, without compounding. For portions of the interest accumulation period that are after 1995, interest is compounded daily at the rate imposed on underpayments of tax under section 6621(a)(2). This compounded interest for periods after 1995 is imposed not only on the tax, but also on the total simple interest attributable to pre-1996 periods.

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If you are a 2019 calendar-year taxpayer and you use June 30, 2019, as the applicable date for calculating interest, use the table below to determine the combined interest rate and enter it on line 51. If you are not a 2019 calendar-year taxpayer or you choose to use the actual date of the distribution as the applicable date, calculate the combined interest rate using the above principles and enter it on line 51.

Table of Combined Interest Rate Imposedon the Total Accumulation Distribution

Look up the applicable number of years of the foreign trust that you entered on line 50. Read across to find the combined interest rate to enter on line 51. Use this table only if you are a 2019 calendar-year taxpayer and are using June 30, 2019, as the applicable date.

Applicable numberof years of trust (from line 50)

Combinedinterest rate (enter on line 51)

1 . . . . . . . . . . . . . . . . . . . . . . . 0.05651.5 . . . . . . . . . . . . . . . . . . . . . . 0.08032 . . . . . . . . . . . . . . . . . . . . . . . 0.10242.5 . . . . . . . . . . . . . . . . . . . . . . 0.12443 . . . . . . . . . . . . . . . . . . . . . . . 0.14733.5 . . . . . . . . . . . . . . . . . . . . . . 0.16744 . . . . . . . . . . . . . . . . . . . . . . . 0.18524.5 . . . . . . . . . . . . . . . . . . . . . . 0.20305 . . . . . . . . . . . . . . . . . . . . . . . 0.22135.5 . . . . . . . . . . . . . . . . . . . . . . 0.23966 . . . . . . . . . . . . . . . . . . . . . . . 0.25856.5 . . . . . . . . . . . . . . . . . . . . . . 0.27747 . . . . . . . . . . . . . . . . . . . . . . . 0.29687.5 . . . . . . . . . . . . . . . . . . . . . . 0.31628 . . . . . . . . . . . . . . . . . . . . . . . 0.33978.5 . . . . . . . . . . . . . . . . . . . . . . 0.36329 . . . . . . . . . . . . . . . . . . . . . . . 0.39099.5 . . . . . . . . . . . . . . . . . . . . . . 0.418810 . . . . . . . . . . . . . . . . . . . . . . 0.447710.5 . . . . . . . . . . . . . . . . . . . . . 0.480311 . . . . . . . . . . . . . . . . . . . . . . 0.521811.5 . . . . . . . . . . . . . . . . . . . . . 0.571812 . . . . . . . . . . . . . . . . . . . . . . 0.636512.5 . . . . . . . . . . . . . . . . . . . . . 0.702713 . . . . . . . . . . . . . . . . . . . . . . 0.772813.5 . . . . . . . . . . . . . . . . . . . . . 0.835414 . . . . . . . . . . . . . . . . . . . . . . 0.896514.5 . . . . . . . . . . . . . . . . . . . . . 0.949015 . . . . . . . . . . . . . . . . . . . . . . 0.993615.5 . . . . . . . . . . . . . . . . . . . . . 1.038716 . . . . . . . . . . . . . . . . . . . . . . 1.085416.5 . . . . . . . . . . . . . . . . . . . . . 1.137817 . . . . . . . . . . . . . . . . . . . . . . 1.203417.5 . . . . . . . . . . . . . . . . . . . . . 1.270018 . . . . . . . . . . . . . . . . . . . . . . 1.351518.5 . . . . . . . . . . . . . . . . . . . . . 1.452719 . . . . . . . . . . . . . . . . . . . . . . 1.566219.5 . . . . . . . . . . . . . . . . . . . . . 1.6770

20 . . . . . . . . . . . . . . . . . . . . . . 1.787120.5 . . . . . . . . . . . . . . . . . . . . . 1.892821 . . . . . . . . . . . . . . . . . . . . . . 2.011821.5 . . . . . . . . . . . . . . . . . . . . . 2.141422 . . . . . . . . . . . . . . . . . . . . . . 2.287222.5 . . . . . . . . . . . . . . . . . . . . . 2.437223 . . . . . . . . . . . . . . . . . . . . . . 2.596323.5 . . . . . . . . . . . . . . . . . . . . . 2.751524 . . . . . . . . . . . . . . . . . . . . . . 2.864124.5 . . . . . . . . . . . . . . . . . . . . . 2.976625 . . . . . . . . . . . . . . . . . . . . . . 3.089225.5 . . . . . . . . . . . . . . . . . . . . . 3.201726 . . . . . . . . . . . . . . . . . . . . . . 3.314326.5 . . . . . . . . . . . . . . . . . . . . . 3.426827 . . . . . . . . . . . . . . . . . . . . . . 3.539427.5 . . . . . . . . . . . . . . . . . . . . . 3.651928 . . . . . . . . . . . . . . . . . . . . . . 3.764428.5 . . . . . . . . . . . . . . . . . . . . . 3.877029 . . . . . . . . . . . . . . . . . . . . . . 3.989529.5 . . . . . . . . . . . . . . . . . . . . . 4.102130 . . . . . . . . . . . . . . . . . . . . . . 4.214630.5 . . . . . . . . . . . . . . . . . . . . . 4.327231 . . . . . . . . . . . . . . . . . . . . . . 4.439731.5 . . . . . . . . . . . . . . . . . . . . . 4.552332 . . . . . . . . . . . . . . . . . . . . . . 4.664832.5 . . . . . . . . . . . . . . . . . . . . . 4.777433 . . . . . . . . . . . . . . . . . . . . . . 4.889933.5 . . . . . . . . . . . . . . . . . . . . . 5.002534 . . . . . . . . . . . . . . . . . . . . . . 5.115034.5 . . . . . . . . . . . . . . . . . . . . . 5.227535 . . . . . . . . . . . . . . . . . . . . . . 5.340135.5 . . . . . . . . . . . . . . . . . . . . . 5.452636 . . . . . . . . . . . . . . . . . . . . . . 5.565236.5 . . . . . . . . . . . . . . . . . . . . . 5.677737 . . . . . . . . . . . . . . . . . . . . . . 5.790337.5 . . . . . . . . . . . . . . . . . . . . . 5.902838 . . . . . . . . . . . . . . . . . . . . . . 6.015438.5 . . . . . . . . . . . . . . . . . . . . . 6.127939 . . . . . . . . . . . . . . . . . . . . . . 6.240539.5 . . . . . . . . . . . . . . . . . . . . . 6.353040 . . . . . . . . . . . . . . . . . . . . . . 6.465540.5 . . . . . . . . . . . . . . . . . . . . . 6.578141 . . . . . . . . . . . . . . . . . . . . . . 6.690641.5 . . . . . . . . . . . . . . . . . . . . . 6.803242 . . . . . . . . . . . . . . . . . . . . . . 6.915742+ . . . . . . . . . . . . . . . . . . . . . 7.0283(Note. Interest charges began in 1977.)

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Line 53. Report this amount as additional tax (ADT) on the appropriate line of your income tax return (for example, for Form 1040 filers, include this amount as part of the total for line 8 on Schedule 2 (Form 1040 or 1040-SR), check box c, and enter “ADT” to the left of the line 8 entry space).Part IV—U.S. Recipients of Gifts or Bequests Received During the Current Tax Year From Foreign PersonsNote. Penalties may be imposed for failure to report gifts that should be reported. See Penalties, earlier.

A gift to a U.S. person does not include any amount paid for qualified tuition or medical payments made on behalf of the U.S. person.

If a foreign trust makes a distribution to a U.S. person, the U.S. person must report the amount as a distribution in Part III, rather than as a gift in Part IV.

Contributions of property by foreign persons to domestic or foreign trusts that have U.S. beneficiaries are not reportable by those beneficiaries in Part IV unless they are treated as receiving the contribution in the year of the transfer (for example, if the U.S. beneficiary is treated as an owner of that portion of the trust under section 678, then the contribution must be reported by such U.S. beneficiary in Part IV).

A domestic trust that is not treated as owned by another person is required to report the receipt of a contribution to the trust from a foreign person as a gift in Part IV.

A domestic trust that is treated as owned by a foreign person is not required to report the receipt of a contribution to the trust from a foreign person. However, a U.S. person should report the receipt of a distribution from a domestic trust that is treated as owned by a foreign person as a gift from a foreign person in Part IV, rather than as a distribution to a U.S. person in Part III.Line 54. To calculate the threshold amount ($100,000), you must aggregate gifts from different foreign nonresident aliens and foreign estates if you know (or have reason to know) that those persons are related to each other (see Related Person, earlier) or one is acting as a nominee or intermediary for the other. For example, if you receive a gift of $75,000 from nonresident alien individual A and a gift of $40,000 from nonresident alien individual B, and you know that A and B are related, you must answer “Yes” and complete columns (a) through (c) for each gift.

If you answered “Yes” to the question on line 54 and none of the gifts or bequests received exceeds $5,000, do not complete columns (a) through (c) of line 54. Instead, enter in column (b) of the first line, “No gifts or bequests exceed $5,000.”Line 55. Answer “Yes” if you received aggregate amounts in excess of $16,388 during the current tax year that you treated as gifts from foreign corporations or foreign partnerships (or any foreign persons that you know

(or have reason to know) are related to such foreign corporations or foreign partnerships).

For example, if you, a calendar-year taxpayer during 2019, received $8,000 from foreign corporation X that you treated as a gift, and $10,000 that you received from nonresident alien A that you treated as a gift, and you know that X is wholly owned by A, you must complete columns (a) through (g) for each gift.Note. Gifts from foreign corporations or foreign partnerships are subject to recharacterization by the IRS under section 672(f)(4).Line 56. If you answered “Yes” to the question on line 56 and the ultimate donor on whose behalf the reporting donor is acting is a foreign corporation or foreign partnership, attach an explanation including the ultimate foreign donor's name, address, identification number, if any, and status as a corporation or partnership.

If the ultimate donor is a foreign trust, treat the amount received as a distribution from a foreign trust and complete Part III.Privacy Act and Paperwork Reduction Act Notice. We ask for the information on this form to carry out the Internal Revenue laws of the United States. You are required to give us the information. We need it to ensure that you are complying with these laws and to allow us to figure and collect the right amount of tax.

Our authority to ask for information is sections 6001, 6011, and 6012(a) and their regulations, which require you to file a return or statement with us for any tax for which you are liable. Your response is mandatory under these sections. Section 6109 requires you to provide your identification number. You must fill in all parts of the tax form that apply to you.

You are not required to provide the information requested on a form that is subject to the Paperwork Reduction Act unless the form displays a valid OMB control number. Books or records relating to a form or its instructions must be retained as long as their contents may become material in the administration of any Internal Revenue law. Generally, tax returns and return information are confidential, as required by section 6103. However, section 6103 allows or requires the Internal Revenue Service to disclose or give the information shown on your tax return to others as described in the Code. For example, we may disclose your tax information to the Department of Justice to enforce the tax laws, both civil and criminal, and to cities, states, the District of Columbia, and U.S. commonwealths or possessions to carry out their tax laws. We may also disclose this information to other countries under a tax treaty, to federal and state agencies to enforce federal nontax criminal laws, or to federal law enforcement and intelligence agencies to combat terrorism. Failure to provide this information, or providing false information, may subject you to fines or penalties.

Please keep this notice with your records. It may help you if we ask you for other information. If you have any questions about the rules for filing and giving information, please call or visit any Internal Revenue Service office.

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The time needed to complete and file this form and related schedules will vary depending on individual circumstances. The estimated burden for individual taxpayers filing this form is approved under OMB control number 1545-0074 and is included in the estimates shown in the instructions for their individual income tax return. The estimated burden for all other taxpayers who file this form is shown below.

Recordkeeping . . . . . . . . . . . . . . . . . . . . . . 42 hr., 34 min.Learning about the law or the form . . . . . . . . 4 hr., 50 min.Preparing the form . . . . . . . . . . . . . . . . . . . 6 hr., 40 min.Sending the form to the IRS . . . . . . . . . . . . . 16 min.

If you have comments concerning the accuracy of these time estimates or suggestions for making this form simpler, we would be happy to hear from you. You can send us comments from IRS.gov/FormComments. Or you can send your comments to: Internal Revenue Service, Tax Forms and Publications Division, 1111 Constitution Ave. NW, IR-6526, Washington, DC 20224. Do not send the tax form to this office. Instead, see When and Where To File, earlier.

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Form 3520-ADepartment of the Treasury Internal Revenue Service

Annual Information Return of Foreign Trust With a U.S. Owner

(Under section 6048(b)) ▶ Go to www.irs.gov/Form3520A for instructions and the latest information.

OMB No. 1545-0159

2019Note: All information must be in English. Show all amounts in U.S. dollars.For calendar year 2019, or tax year beginning , 2019, ending , 20 .

Check appropriate boxes. Initial return Final return Amended return

Check if any excepted specified foreign financial assets are reported on this form (see instructions) . . . . . . . . . . . . . .

Part I General Information (see instructions)1a Name of foreign trust b(1) Employer identification number

b(2) Reference ID number (see instructions)c Number, street, and room or suite no. (if a P.O. box, see instructions)

d City or town e State or province f ZIP or foreign postal code g Country

2

Did the foreign trust appoint a U.S. agent (defined in the instructions) who can provide the IRS with all the relevant trust information? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Yes No

If “Yes,” skip lines 2a through 2e and go to line 3.If “No,” you are required to attach a copy of all trust documents as indicated below. If these documents have been attached to a Form 3520-A filed within the previous 3 years, attach only relevant updates.

Have you attached a copy of: Yes NoAttached

PreviouslyYear

Attached

a Summary of all written and oral agreements and understandings relating to the trust? . . .

b The trust instrument? . . . . . . . . . . . . . . . . . . . . . .

c Memoranda or letters of wishes? . . . . . . . . . . . . . . . . . .

d Subsequent variances to original trust documents? . . . . . . . . . . . . .

e Other trust documents? . . . . . . . . . . . . . . . . . . . . .

3a Name of U.S. agent b Identification number

c Number, street, and room or suite no. (if a P.O. box, see instructions)

d City or town e State or province f ZIP or postal code g Country

4a Name of trustee b Identification number, if any

c Number, street, and room or suite no. (if a P.O. box, see instructions)

d City or town e State or province f ZIP or postal code g Country

5

Did the trust transfer (directly or indirectly) any property (including cash) to another person (see instructions for definition of person) during the foreign trust’s tax year? If “Yes,” attach a statement (see instructions) . . . . . Yes No

6 Enter the number of Foreign Grantor Trust Owner Statements (pages 3 and 4) included with this Form 3520-A ▶

Sign Here

Under penalties of perjury, I declare that I have examined this return, including any accompanying reports, schedules, or statements, and to the best of my knowledge and belief, it is true, correct, and complete.▲

Trustee’s Signature

▲

Title

▲

Date

Paid Preparer Use Only

Print/Type preparer’s name Preparer’s signature Date Check if self-employed

PTIN

Firm’s name ▶

Firm’s address ▶

Firm’s EIN ▶

Phone no.

For Paperwork Reduction Act Notice, see instructions. Cat. No. 19595G Form 3520-A (2019)

Form 3520-A (2019) Page 2 Part II Foreign Trust Income Statement

Enter totals from books and records of foreign trust (see instructions).

Inco

me

1 Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2 Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3 Gross rents and royalties . . . . . . . . . . . . . . . . . . . . . . . . . .

4 Income (loss) from partnerships and fiduciaries . . . . . . . . . . . . . . . . . . . .

5 Capital gains:

a Net short-term capital gain (loss) . . . . . . . . . . . . . . . . . . . . . . . .

b Net long-term capital gain (loss) . . . . . . . . . . . . . . . . . . . . . . . .

6 Ordinary gains (losses) . . . . . . . . . . . . . . . . . . . . . . . . . . .

7 Other income (attach statement) . . . . . . . . . . . . . . . . . . . . . . . .8 Total income (add lines 1 through 7) . . . . . . . . . . . . . . . . . . . . . . .

Exp

ense

s

9 Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

10a Foreign taxes (attach statement) . . . . . . . . . . . . . . . . . . . . . . . .

b State and local taxes . . . . . . . . . . . . . . . . . . . . . . . . . . .

11 Amortization and depreciation (depletion) . . . . . . . . . . . . . . . . . . . . .

12 Trustee and advisor fees . . . . . . . . . . . . . . . . . . . . . . . . . .

13 Charitable contributions . . . . . . . . . . . . . . . . . . . . . . . . . . .

14 Other expenses (attach statement) . . . . . . . . . . . . . . . . . . . . . . .15 Total expenses (add lines 9 through 14) . . . . . . . . . . . . . . . . . . . . . .

16 Net income (loss) (subtract line 15 from line 8) . . . . . . . . . . . . . . . . . . . .

17a Enter the fair market value (FMV) of total distributions (directly or indirectly) from the trust to all persons, whether U.S. or foreign. See instructions for definitions of distribution and person . . . . . . . . . . . ▶

b Distributions to U.S. owners:(i) Name of owner (ii) Identification number (iii) Date of distribution (iv) FMV on date of distribution

c Distributions to U.S. beneficiaries:(i) Name of beneficiary (ii) Identification number (iii) Date of distribution (iv) FMV on date of distribution

Part III Foreign Trust Balance Sheet Beginning of Tax Year End of Tax Year

Assets (a) (b) (c) (d)

1 Cash . . . . . . . . . . . . .

2 Accounts receivable . . . . . . . . .

3 Mortgages and notes receivable . . . . .

4 Inventories . . . . . . . . . . . .

5 Government obligations . . . . . . . .

6 Other marketable securities . . . . . . .

7 Other nonmarketable securities . . . . . .

8a Depreciable (depletable) assets . . . . . .

b Less: accumulated depreciation (depletion) . .

9 Real property . . . . . . . . . . .

10 Other assets (attach statement) . . . . . .

11 Total assets . . . . . . . . . . .

Liabilities12 Accounts payable . . . . . . . . . .

13 Contributions, gifts, grants, etc., payable . . .

14 Mortgages and notes payable . . . . . .

15 Other liabilities (attach statement) . . . . .

16 Total liabilities . . . . . . . . . . .

Net Worth17 Contributions to trust corpus . . . . . .

18 Accumulated trust income . . . . . . .

19 Other (attach statement) . . . . . . . .

20 Total net worth (add lines 17 through 19) . . .

21 Total liabilities and net worth (add lines 16 and 20)

Form 3520-A (2019)

Form 3520-A (2019) Page 3 2019 Foreign Grantor Trust Owner Statement (see instructions)

Important: Trustee must prepare a separate statement for each U.S. owner and include a copy of each statement with Form 3520-A. Trustee is also required to send to each U.S. owner a copy of the owner’s statement. U.S. owner must attach a copy of its statement to Form 3520.

1a Name of foreign trust b(1) Employer identification number

b(2) Reference ID number (see instructions)c Number, street, and room or suite no. (if a P.O. box, see instructions)

d City or town e State or province f ZIP or foreign postal code g Country

2 Did the foreign trust appoint a U.S. agent (defined in the instructions) who can provide the IRS with all relevant trust information? If “Yes,” complete lines 3a through 3g.

Yes No

3a Name of U.S. agent b Identification number

c Number, street, and room or suite no. (if a P.O. box, see instructions)

d City or town e State or province f ZIP or postal code g Country

4a Name of trustee b Identification number (if any)

c Number, street, and room or suite no. (if a P.O. box, see instructions)

d City or town e State or province f ZIP or postal code g Country

5 The first and last day of the tax year of the foreign trust to which this statement relates ▶

6a Name of U.S. owner b Identification number

c Number, street, and room or suite no. (if a P.O. box, see instructions)

d City or town e State or province f ZIP or postal code g Country

h Service Center where U.S. owner files its income tax returns ▶

7 Attach an explanation of the facts and law (including the section of the Internal Revenue Code) that establishes that the foreign trust (or portion of the foreign trust) is treated for U.S. tax principles as owned by the U.S. person.

8 If the trust did not appoint a U.S. agent, list the trust documents attached to Form 3520-A (see instructions).

9 Gross value of the portion of the trust treated as owned by the U.S. owner . . . . . . . $

10 Cash amounts or FMV of property distributed, directly or indirectly, during the foreign trust’s tax year, from the foreign trust (exclude loans) to the U.S. owner.

(a) Date of distribution

(b) Description of property distributed

(c) FMV of property distributed

(determined on date of distribution)

(d) Description of property

transferred, if any

(e) FMV of property

transferred

(f) Excess of column (c)

over column (e)

Totals. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ▶ $

Form 3520-A (2019)

Form 3520-A (2019) Page 4 2019 Statement of Foreign Trust Income Attributable to U.S. Owner (see instructions)

Report each item on the proper form or schedule of your tax return.

Inco

me

1a Taxable interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . .b Tax-exempt interest ▶

2a Total ordinary dividends . . . . . . . . . . . . . . . . . . . . . . . . . . .b Qualified dividends ▶

3 Gross rents and royalties . . . . . . . . . . . . . . . . . . . . . . . . . .

4 Income from partnerships and fiduciaries . . . . . . . . . . . . . . . . . . . . . .

5 Capital gains (losses) . . . . . . . . . . . . . . . . . . . . . . . . . . .

6 Ordinary gains (losses) . . . . . . . . . . . . . . . . . . . . . . . . . . .

7 Other income (attach statement) . . . . . . . . . . . . . . . . . . . . . . . .

8 Total income. Add lines 1 through 7 . . . . . . . . . . . . . . . . . . . . . . ▶

Exp

ense

s

9 Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

10a Foreign taxes (attach statement) . . . . . . . . . . . . . . . . . . . . . . . .

b State and local taxes . . . . . . . . . . . . . . . . . . . . . . . . . . .

11 Amortization and depreciation (depletion) . . . . . . . . . . . . . . . . . . . . .

12 Trustee and advisor fees. . . . . . . . . . . . . . . . . . . . . . . . . . .

13 Charitable contributions . . . . . . . . . . . . . . . . . . . . . . . . . . .

14 Other expenses (attach statement) . . . . . . . . . . . . . . . . . . . . . . . .15 Total expenses. Add lines 9 through 14 . . . . . . . . . . . . . . . . . . . . . ▶

Under penalties of perjury, I declare that I have examined this return, including any accompanying reports, schedules, or statements, and to the best of my knowledge and belief, it is true, correct, and complete.

Trustee Signature ▶ Title ▶ Date ▶

Form 3520-A (2019)

Form 3520-A (2019) Page 5 2019 Foreign Grantor Trust Beneficiary Statement

Important: Trustee must prepare a separate statement for each U.S. beneficiary that received a distribution from the trust during the tax year and include a copy of each statement with Form 3520-A. Trustee is also required to send to each such beneficiary a copy of the beneficiary’s statement. Each U.S. beneficiary must attach a copy of its statement to its Form 3520.

1a Name of foreign trust b(1) Employer identification number

b(2) Reference ID number (see instructions)c Number, street, and room or suite no. (if a P.O. box, see instructions)

d City or town e State or province f ZIP or foreign postal code g Country

2

Did the foreign trust appoint a U.S. agent (defined in the instructions) who can provide the IRS with all relevant trust information? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Yes NoIf “Yes,” complete lines 3a through 3g.

If “No,” do you agree that either the IRS or the U.S. beneficiary can inspect and copy the trust’s permanent books of account, records, and such other documents that are necessary to establish that the trust should be treated for U.S. tax purposes as owned by another person? . . . . . . . . . . . . . . . . . . . . . . Yes No

3a Name of U.S. agent b Identification number

c Number, street, and room or suite no. (if a P.O. box, see instructions)

d City or town e State or province f ZIP or postal code g Country

4a Name of trustee b Identification number (if any)

c Number, street, and room or suite no. (if a P.O. box, see instructions)

d City or town e State or province f ZIP or postal code g Country

5 The first and last day of the tax year of the foreign trust to which Form 3520-A applies ▶

6a Name of U.S. beneficiary b Identification number

c Number, street, and room or suite no. (if a P.O. box, see instructions)

d City or town e State or province f ZIP or postal code g Country

7 Cash amounts or FMV of property that during the current tax year was: (1) distributed directly or indirectly to a U.S. person whether or not the U.S. person is designated as a beneficiary of the trust, (2) loaned (exclude loans treated as qualified obligations) directly or indirectly to the U.S. person who is a beneficiary of the trust or a U.S. person related to that U.S. person, or (3) used by the U.S. person who is a beneficiary of the trust or a U.S. person related to that U.S. person without compensating the trust for the FMV of the use of the property within a reasonable period of time. (See the instructions for Part III of Form 3520 for U.S. tax treatment of these amounts).

(a) Date of distribution

(b) Description of property distributed

(c) FMV of property distributed

(determined on date of distribution)

(d) Description of property

transferred, if any

(e) FMV of property

transferred

(f) Excess of column (c)

over column (e)

Totals. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ▶ $8

Attach an explanation of the facts and law (including the section of the Internal Revenue Code) that establishes that the foreign trust (or portion of the foreign trust) is treated for U.S. tax principles as owned by another person.

9 Owner of the foreign trust is (check one):Individual Partnership Corporation

Under penalties of perjury, I declare that I have examined this return, including any accompanying reports, schedules, or statements, and to the best of my knowledge and belief, it is true, correct, and complete.

Trustee Signature ▶ Title ▶ Date ▶

Form 3520-A (2019)

Userid: CPM Schema: instrx

Leadpct: 100% Pt. size: 10 Draft Ok to PrintAH XSL/XML Fileid: … ons/I3520A/2019/A/XML/Cycle10/source (Init. & Date) _______Page 1 of 7 14:12 - 18-Feb-2020The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

2019Instructions for Form 3520-AAnnual Information Return of Foreign Trust With a U.S. Owner

Department of the TreasuryInternal Revenue Service

Section references are to the Internal Revenue Code unless otherwise noted.

General InstructionsFuture DevelopmentsFor the latest information about developments related to Form 3520-A and its instructions, such as legislation enacted after they were published, go to IRS.gov/Form3520A.Purpose of FormForm 3520-A is the annual information return of a foreign trust with at least one U.S. owner. The form provides information about the foreign trust, its U.S. beneficiaries, and any U.S. person who is treated as an owner of any portion of the foreign trust under the grantor trust rules (sections 671 through 679).Who Must FileA foreign trust with a U.S. owner must file Form 3520-A in order for the U.S. owner to satisfy its annual information reporting requirements under section 6048(b). Each U.S. person treated as an owner of any portion of a foreign trust under the grantor trust rules (sections 671 through 679) is responsible for ensuring that the foreign trust files Form 3520-A and furnishes the required annual statements to its U.S. owners and U.S. beneficiaries. If a foreign trust fails to file Form 3520-A, the U.S. owner must complete and attach a substitute Form 3520-A for the foreign trust to the U.S. owner’s Form 3520, Annual Return To Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts, by the due date of the U.S. owner’s Form 3520 (and not the due date for the Form 3520-A, which is otherwise due by the 15th day of the 3rd month after the end of the trust’s tax year) in order to avoid being subject to the additional separate penalty for the foreign trust’s failure to file a Form 3520-A. See Part II, line 22, of the Instructions for Form 3520. See Penalties, later.Exception. Custodians of Canadian registered retirement savings plans (RRSPs) and Canadian registered retirement income funds (RRIFs) are not required to file Form 3520-A with respect to a U.S. citizen or resident alien who holds an interest in an RRSP or RRIF. In addition, custodians of any other Canadian retirement plan within the meaning of section 3 of Rev. Proc. 2014-55 are not required to file Form 3520-A for a U.S. citizen or resident alien owner or beneficiary. See Rev. Proc. 2014-55, 2014-44 I.R.B. 753, available at IRS.gov/irb/2014-44_IRB/ar10.html.

When and Where To FileFile a complete Form 3520-A (including the statements on pages 3 through 5) with the Internal Revenue Service Center, P.O. Box 409101, Ogden, UT 84409, by the 15th day of the 3rd month after the end of the trust's tax year. However, if you are filing a substitute Form 3520-A with your Form 3520, then your substitute Form 3520-A is due by the due date of Form 3520. See the Instructions for Form 3520 for the due date of the Form 3520. Give copies of the Foreign Grantor Trust Owner Statement (pages 3 and 4 of Form 3520-A) and the Foreign Grantor Trust Beneficiary Statement (page 5 of Form 3520-A) to the U.S. owners and U.S. beneficiaries by the 15th day of the 3rd month after the end of the trust's tax year.

An automatic 6-month extension of time to file Form 3520-A (including the statements on pages 3 through 5) may be granted by filing Form 7004, Application for Automatic Extension of Time To File Certain Business Income Tax, Information, and Other Returns, by the 15th day of the 3rd month after the end of the trust’s tax year. For details, see Form 7004.Note. An extension of time to file an income tax return will not provide an extension of time to file Form 3520-A. Form 7004 must be filed in order to request an extension of time to file Form 3520-A.

Form 3520-A must have all required attachments to be considered complete.Who Must SignIf the return is filed by:• An individual or fiduciary, it must be signed and dated by that individual or fiduciary;• A partnership, it must be signed and dated by a general partner or limited liability company member; or• A corporation, it must be signed and dated by the president, vice president, treasurer, assistant treasurer, chief accounting officer, or any other corporate officer (such as a tax officer) authorized to sign.Note. If the return is a substitute Form 3520-A that is being completed by a U.S. owner and attached to the U.S. owner’s Form 3520, then the U.S. owner must sign and date the return and provide the U.S. owner’s name and identification number on the Title line of the signature box. For more information about the requirements to file a substitute Form 3520-A, see Part II, line 22, of the Instructions for Form 3520.

The paid preparer must complete the required preparer information and:• Sign the return in the space provided for the preparer's signature, and• Give a copy of the return to the filer.

Feb 18, 2020 Cat. No. 25096U

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PenaltiesThe U.S. owner is subject to an initial penalty equal to the greater of $10,000 or 5% of the gross value of the portion of the trust's assets treated as owned by the U.S. person at the close of that tax year if the foreign trust (a) fails to file a timely Form 3520-A, or (b) does not furnish all of the information required by section 6048(b) or includes incorrect information. See section 6677(a) through (c). If a foreign trust fails to file a Form 3520-A, the U.S. owner must complete and attach a substitute Form 3520-A to the U.S. owner’s Form 3520 by the due date of the U.S. owner’s Form 3520 (and not the due date for Form 3520-A) in order to avoid being subject to a penalty for the foreign trust’s failure to file a Form 3520-A. For example, a substitute Form 3520-A that, to the best of the U.S. owner’s ability, is completed and attached to the U.S. owner’s Form 3520 by the due date for the Form 3520 (such as April 15 for the U.S. owners who are individuals) is considered timely filed.

The U.S. owner is subject to an additional separate penalty equal to the greater of $10,000 or 5% of the gross value of the portion of the trust's assets treated as owned by the U.S. person at the close of that tax year if the U.S. owner (a) fails to file a timely Form 3520 (Part II), or (b) fails to furnish all of the information required by section 6048(b) or includes incorrect information. See section 6677(a) through (c) and the Instructions for Form 3520.

Additional penalties will be imposed if the noncompliance continues for more than 90 days after the IRS mails a notice of failure to comply with the required reporting. If the IRS can determine the gross value (defined later) of the portion of the trust’s assets treated as owned by the U.S. person at the close of the tax year, then the additional penalties will be reduced as necessary to assure that the aggregate amount of such penalties does not exceed the gross value of the trust. For more information, see section 6677.

Criminal penalties may be imposed under sections 7203, 7206, and 7207 for failure to file on time and for filing a false or fraudulent return.Note. If a U.S. owner of a foreign trust is subject to a penalty imposed under section 6662 for an underpayment of tax required to be shown on a return, then such penalty may be increased under section 6662(j) for any portion of an underpayment which is attributable to any transaction involving any asset with respect to which information was required to be provided on Form 3520-A. For more information about undisclosed foreign financial asset understatements, see section 6662(j).Reasonable cause. No penalties will be imposed if the taxpayer can demonstrate that the failure to comply with the reporting requirements was due to reasonable cause and not willful neglect.Note. The fact that a foreign country would impose penalties for disclosing the required information is not reasonable cause. Similarly, reluctance on the part of a foreign fiduciary or provisions in the trust instrument that prevent the disclosure of required information is not reasonable cause. See section 6677(d) for more information.

DefinitionsDistributionA distribution for section 6048(c) reporting purposes is any gratuitous transfer of money or other property from a trust, whether or not the trust is treated as a grantor trust under the grantor trust rules (sections 671 through 679), and without regard to whether the recipient is designated as a beneficiary by the terms of the trust. A distribution includes the receipt of trust corpus and the receipt of a gift or bequest described in section 663(a).

A distribution also includes constructive transfers from a trust. For example, if charges you make on a credit card are paid by a foreign trust or guaranteed or secured by the assets of a foreign trust, the amount charged will be treated as a distribution to you by the foreign trust. Similarly, if you write checks on a foreign trust's bank account, the amount will be treated as a distribution. See section V of Notice 97-34, 1997-25 I.R.B. 22. Also, if you receive a payment from a foreign trust in exchange for property transferred to the trust or services rendered to the trust, and the fair market value (FMV) of the payment you received exceeds the FMV of the property transferred or services rendered, the excess will be treated as a distribution to you. See section V of Notice 97-34, 1997-25 I.R.B. 22.

Examples: 1. If you sell stock with an FMV of $100 to a foreign

trust and receive $150 in exchange, you have received a distribution of $50.

2. If you receive $100 from the trust for services performed by you for the trust, and the services have an FMV of $20, you have received a distribution of $80.Foreign Trust and Domestic TrustA foreign trust is any trust other than a domestic trust. A domestic trust is any trust if:

1. A court within the United States is able to exercise primary supervision over the administration of the trust, and

2. One or more U.S. persons have the authority to control all substantial decisions of the trust.GrantorA grantor includes any person who creates a trust or directly or indirectly makes a gratuitous transfer of cash or other property to a trust. A grantor includes any person treated as the owner of any part of a foreign trust's assets under sections 671 through 679, excluding section 678.Note. If a partnership or corporation makes a gratuitous transfer to a trust, the partners or shareholders are generally treated as the grantors of the trust, unless the partnership or corporation made the transfer for a business purpose of the partnership or corporation.

If a trust makes a gratuitous transfer to another trust, the grantor of the transferor trust is treated as the grantor of the transferee trust, except that if a person with a general power of appointment over the transferor trust exercises that power in favor of another trust, such person is treated as the grantor of the transferee trust, even if the

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grantor of the transferor trust is treated as the owner of the transferor trust.Grantor TrustA grantor trust is any trust to the extent that the assets of the trust are treated as owned by a person other than the trust. See the grantor trust rules in sections 671 through 679. A part of the trust may be treated as a grantor trust to the extent that only a portion of the trust assets are owned by a person other than the trust.Note. Due to changes to section 679(c) made by the HIRE Act, effective after March 18, 2010, a loan of cash or marketable securities from a foreign trust with a U.S. transferor, directly or indirectly, to a U.S. person, or the use of any other trust property directly or indirectly by any U.S. person (whether or not a beneficiary under the terms of the trust) will cause a foreign trust to be treated as having a U.S. beneficiary, unless the U.S. person repays the loan at a market rate of interest or pays the FMV of the use of such property within a reasonable period of time. Thus, in the case of a foreign trust with a U.S. transferor that is treated as having a U.S. beneficiary, the foreign trust is treated as a grantor trust under the grantor trust rules.Gross ValueGross value is the value of property as determined under section 2512 and its regulations, without regard to any prohibitions or restrictions on a person's interest in the property. See section VII of Notice 97-34. Although formal appraisals are generally not required, you should keep contemporaneous records of how you arrived at your good faith estimate.Nongrantor TrustA nongrantor trust is any trust to the extent that the assets of the trust are not treated as owned by a person other than the trust. Thus, a nongrantor trust is treated as a taxable entity. A trust may be treated as a nongrantor trust with respect to only a portion of the trust assets. See Grantor Trust above.OwnerAn owner of a foreign trust is the person that is treated as owning any of the assets of a foreign trust under the grantor trust rules.PropertyProperty means any property, whether tangible or intangible, including cash.U.S. AgentA U.S. agent is a U.S. person (defined later) that has a binding contract with a foreign trust that allows the U.S. person to act as the trust's authorized U.S. agent (see the instructions for Part I, Lines 3a through 3g, later) in applying sections 7602, 7603, and 7604 with respect to:• Any request by the IRS to examine records or produce testimony related to the proper U.S. tax treatment of amounts distributed, or required to be taken into account under the grantor trust rules, with respect to a foreign trust; or

• Any summons by the IRS for such records or testimony.A U.S. grantor, a U.S. beneficiary, or a domestic

corporation controlled by the grantor or beneficiary may act as a U.S. agent. However, you may not treat the foreign trust as having a U.S. agent unless you enter the name, address, and taxpayer identification number of the U.S. agent on lines 3a through 3g of Part I of the form. See Identification numbers, later.

If the person identified as the U.S. agent does not produce records or testimony when requested or summoned by the IRS, the IRS may redetermine the amounts required to be taken into account with respect to the foreign trust by the U.S. owner. See section 6048(b)(2).

The agency relationship must be established by the time the U.S. person files Form 3520-A for the relevant tax year and must continue as long as the statute of limitations remains open for the relevant tax year. If the agent’s responsibility as an agent of the trust is terminated for any reason (for example, agent’s resignation, agent’s liquidation, or agent’s death), see section IV(B) of Notice 97-34.U.S. BeneficiaryA U.S. beneficiary generally includes any person that could possibly benefit (directly or indirectly) from the trust (including an amended trust) at any time, whether or not the person is designated in the trust instrument as a beneficiary and whether or not the person can receive a distribution from the trust in the current year. In addition, a U.S. beneficiary includes:• A foreign corporation that is a controlled foreign corporation (as defined in section 957(a)),• A foreign partnership if a U.S. person is a partner of the partnership, and• A foreign estate or trust if the estate or trust has a U.S. beneficiary.Foreign trust treated as having a U.S. beneficiary. In general, a foreign trust will be treated as having a U.S. beneficiary unless the terms of the trust instrument specifically prohibit any distribution of income or corpus to a U.S. person at any time, even after the death of the U.S. transferor or any event terminating the trust, and the trust cannot be amended or revised to allow such a distribution. For these purposes, an amount will be treated as accumulated for the benefit of a U.S. person even if the U.S. person's interest in the trust is contingent on a future event and regardless of whether anything is actually distributed to a U.S. person during that tax year.

Special rule in case of discretion to identify beneficiaries. For purposes of the general rule above, if any person has the discretion of making a distribution from the trust to, or for the benefit, of any person, the trust will be treated as having a beneficiary who is a U.S. person, unless the terms of the trust specifically identify the class of persons to whom such distributions may be made, and none of those persons are U.S. persons during the tax year.

Certain agreements and understandings treated as terms of the trust. For purposes of the general rule above, if any U.S. person who directly or indirectly transfers property to the trust is directly or indirectly

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involved in any agreement or understanding (whether written, oral, or otherwise) that may result in the income or corpus of the trust being paid or accumulated to or for the benefit of a U.S. person, such agreement or understanding will be treated as a term of the trust.

Certain loans or uncompensated use of trust property. If a foreign trust is not already treated as having a U.S. beneficiary under the rules described above, the trust will be treated as having a U.S. beneficiary if, after March 18, 2010, either:• The foreign trust loans cash or marketable securities, directly or indirectly, to a U.S. person and the U.S. person does not repay the loan at a market rate of interest within a reasonable period of time; or• A U.S. person uses property that is owned by the foreign trust and does not pay FMV of the use of such property within a reasonable period of time.Presumption that foreign trust has U.S. beneficiary. For transfers of property after March 18, 2010, if a U.S. person, directly or indirectly, transfers property to a foreign trust (other than a deferred compensation or charitable trust described in section 6048(a)(3)(B)(ii)), the IRS may treat such trust as having a U.S. beneficiary for purposes of applying section 679(d) to such transfer if the IRS requests information with respect to the transfer and the U.S. person fails to demonstrate to the satisfaction of the IRS that no portion of the income or corpus of the trust may ever be paid to or accumulated for the benefit of a U.S. person.U.S. PersonA U.S. person is:• A citizen or resident alien of the United States (see Pub. 519, U.S. Tax Guide for Aliens, for guidance on determining resident alien status),• A domestic partnership,• A domestic corporation,• Any estate (other than a foreign estate, within the meaning of section 7701(a)(31)(A)), and• Any domestic trust (defined earlier).

Specific InstructionsPeriod CoveredFile the 2019 return for calendar year 2019 and fiscal years that begin in 2019 and end in 2020. For a fiscal year, fill in the tax year in the space at the top of the form.Initial Return, Final Return, Amended ReturnInitial return. If this is the foreign trust's first return, check the “Initial return” box.Final return. If the foreign trust ceases to exist, check the “Final return” box.Amended return. If this Form 3520-A is filed to amend a Form 3520-A that you previously filed, check the “Amended return” box.

Excepted Specified Foreign Financial Assets ReportedCheck the box only if a U.S. person treated as the owner of any portion of the trust under the grantor trust rules also files Form 8938, Statement of Specified Foreign Financial Assets, for the tax year and includes this form in the total number of Forms 3520-A reported on line 2 of Part IV, Excepted Specified Foreign Financial Assets, of Form 8938. For more information, see the Instructions for Form 8938, generally, and in particular, Duplicate Reporting and the specific instructions for Part IV.Part I—General InformationIdentification numbers. Use social security numbers or individual taxpayer identification numbers to identify individuals. Use employer identification numbers (EINs) to identify estates, trusts, partnerships, and corporations.

Do not enter a preparer tax identification number (PTIN) in any entry space on Form 3520-A other than the entry space for “PTIN” at the bottom of

page 1 of the form.Address. Include the room, suite, or other unit number after the street address. If the post office does not deliver mail to the street address and the U.S. person has a P.O. box, show the box number instead.Foreign address. Do not abbreviate the country name.Line 1b(1). Do not enter a social security number (SSN) or individual taxpayer identification number (ITIN) in line 1b(1). Only EINs should be used to identify the foreign trust. If you do not have an EIN for the foreign trust, see Form SS-4, Application for Employer Identification Number, and its instructions.Line 1b(2). A reference ID number is required on line 1b(2) only in cases where no EIN was entered for the foreign trust on line 1b(1). However, filers are permitted to enter both an EIN on line 1b(1) and a reference ID number on line 1b(2). If applicable, enter the reference ID number (defined below) you have assigned to the foreign trust.

A “reference ID number” for Form 3520-A purposes is a number established with respect to the foreign trust by or on behalf of the U.S. owner of the foreign trust for which Form 3520-A reporting is required. This number is used to uniquely identify the foreign trust treated as owned by a U.S. person in order to keep track of the trust from tax year to tax year. The reference ID number must meet the requirements set forth below.Note. Because reference ID numbers are established by or on behalf of the U.S. owner of the foreign trust filing Form 3520-A, there is no need to apply to the IRS to request a reference ID number or for permission to use these numbers.Note. When a reference ID number is established with respect to a foreign trust on a Form 3520-A, then the U.S. owner(s) of the foreign trust should also use that same reference ID number with respect to such foreign trust on Form 3520. In general, the reference ID number assigned to a foreign trust on Form 3520-A has relevance only on

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Form 3520-A and Form 3520 (and on any other form that is attached to or associated with Form 3520-A) and should not be used with respect to the foreign trust on other IRS forms.Requirements. The reference ID number must be alphanumeric (defined below) and no special characters or spaces are permitted. The length of a given reference ID number is limited to 50 characters.

For these purposes, the term “alphanumeric” means the entry can be alphabetical, numeric, or any combination of the two.

The same reference ID number must be used consistently from tax year to tax year with respect to the foreign trust. If for any reason a reference ID number falls out of use (for example, the foreign trust is terminated and no longer exists), the reference ID number used for that foreign trust cannot be used again for another foreign trust for purposes of Form 3520-A reporting.

There are some situations that warrant correlation of a new reference ID number with a previous reference ID number when assigning a new reference ID number to a foreign trust. See the following examples.• In the case of a trust that has received assets from another trust, a Form 3520-A filer must use a reference ID number for the receiving trust which correlates the previous reference ID number for the distributed trust with the new reference ID number assigned to the receiving foreign trust.• You must correlate the reference ID numbers as follows: New reference ID number, Old reference ID number. If there is more than one old reference ID number, you must enter a space between each number. As indicated above, the length of a given reference ID number is limited to 50 characters and each number must be alphanumeric and no special characters are permitted.Note. This correlation requirement applies only to the first year the new reference ID number is used.Line 2. If the trust did not appoint a U.S. agent, attach the following documents to Form 3520-A.• A summary of the terms of the trust that includes a summary of any oral agreements or understandings you have with the trustee, whether or not legally enforceable.• A copy of all trust documents (and any revisions), including the trust instrument, any memoranda of wishes prepared by the trustees summarizing the settlor's wishes, any letter of wishes prepared by the settlor summarizing his or her wishes, and any similar documents.Note. If these documents have been attached to a Form 3520-A filed within the previous 3 years, attach only relevant updates.Lines 3a through 3g. If a foreign trust with a U.S. owner does not have a U.S. agent, the IRS may determine the amounts required to be taken into account with respect to the foreign trust by the U.S. owner. See section 6048(b)(2). In order to avoid this, a U.S. owner of a foreign trust should ensure that the foreign trust appoints a U.S. person to act as the foreign trust's limited agent for purposes of applying sections 7602, 7603, and 7604 with respect to a request by the IRS to examine records or produce testimony, or a summons by the IRS for such

records or testimony. Any U.S. citizen, resident alien, or domestic corporation (including a U.S. grantor or U.S. beneficiary of a foreign trust) may act as the U.S. agent of the trust.

In order to authorize a U.S. person to act as an agent under section 6048(b), the trust and the agent must enter into a binding agreement substantially in the format that follows. Attach a copy of the authorization to Form 3520-A.

AUTHORIZATION OF AGENT

[ Name of foreign trust ] hereby expressly authorizes [ name ofU.S. agent ] to act as its agent solely for purposes of sections7602, 7603, and 7604 of the Internal Revenue Code with respect toany request to examine records or produce testimony related to theproper treatment of amounts required to be taken into accountunder the rules of section 6048(b)(1)(A) or to any summons for suchrecords or testimony. I certify that I have the authority to executethis authorization of agent to act on behalf of [ name of foreigntrust ].

Signature of trustee(or other authorized person)

(title) (date)

Identification Number (if any)

Address

[ Name of agent ] accepts this appointment to act as agentfor [ name of foreign trust ] for the above purpose. I certify that Ihave the authority to execute this authorization of agent to act onbehalf of [ name of foreign trust ] and agree to accept service ofprocess for the above purposes.

Signature of agent (title) (date)

Identification Number (if any)

Address

Your Name (type or print)

Your Name (type or print)

Do not enter a PTIN on the authorization form.

Line 5. Attach a statement that provides the following information concerning the transfer.

1. Name, U.S. taxpayer identification number (if any), and country of organization or residence of the person to whom the property was transferred.

2. A general description of the transfer, and any broader transaction of which it forms a part, including a chronology of the transfers involved and an identification of the other parties to the transaction to the extent known.

3. A description of the property transferred, including the estimated FMV and the adjusted basis of the property.

4. A description of the consideration received by the trust, including its estimated FMV, and for stock or securities, the class or type, amount, and characteristics of the interest received. If no consideration was received by the trust, indicate whether the trust or a U.S. owner exercises any powers over the entity to which the property

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was transferred (including a description of such powers), and identify the name, U.S. taxpayer identification number (if any), and country of organization or residence of all beneficial owners of such entity.

5. To the extent known, a description of any subsequent transfer of the property, including the name, U.S. taxpayer identification number (if any), and country of organization or residence of the person to whom the property was subsequently transferred.

The statement must also contain a description of the trust ownership structure setting forth the name, U.S. taxpayer identification number (if any), and country of organization of all entities in which the trust has an ownership interest, including an ownership chart showing the trust's position in the chain of ownership and the percentages of ownership.Note. The term “person” includes an individual or an entity, whether U.S. or foreign. See the definition of U.S. person earlier. A foreign person is an individual or entity that is not a U.S. person.Line 6. Enter the number of Foreign Grantor Trust Owner Statements (pages 3 and 4) included with this Form 3520-A.Part II—Foreign Trust Income StatementInclude all income from U.S. and non-U.S. sources. This financial statement must reasonably reflect the trust's income under U.S. income tax principles.IncomeLine 1. Interest. Report all taxable interest income that was received during the tax year. Examples of taxable interest include, but are not limited to, interest from the following.• Accounts (including certificates of deposit and money market accounts) with banks, credit unions, and thrift institutions.• Notes, loans, and mortgages.• U.S. Treasury bills, notes, and bonds.• U.S. savings bonds.• Original issue discount.• Income received as a regular interest holder of a real estate mortgage investment conduit (REMIC).

For taxable bonds acquired after 1987, amortizable bond premium is treated as an offset to the interest income instead of as a separate interest deduction. See Pub. 550, Investment Income and Expenses.Line 2. Dividends. Report all ordinary dividends received during the tax year.Note. Report capital gain distributions on line 5.Line 4. Income (loss) from partnerships, fiduciaries, etc. Enter the trust's share of income or (losses) from partnerships, S corporations, estates, other trusts, and REMICs.

If the trust received a Schedule K-1 from a partnership, S corporation, or other flow-through entity, use the

corresponding lines on Form 3520-A to report the interest, dividends, capital gains, etc., from the flow-through entity.Line 5. Capital gains (losses). For capital gains or (losses) attributable to a U.S. owner, use Schedule D (corporate or individual, whichever applies) and Form 8949, Sales and Other Dispositions of Capital Assets, if applicable.Line 6. Ordinary gains (losses). Enter the ordinary gain or (loss) from the sale or exchange of property other than capital assets and also from involuntary conversions (other than casualty or theft).Line 7. Other income. Enter other items of income not included on lines 1 through 6. List the types and amounts on an attached statement if the trust has more than one item.

Items to be reported on line 7 include any part of a total distribution shown on Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc., that is treated as ordinary income. For more information, see the Instructions for Form 4972, Tax on Lump-Sum Distributions.ExpensesLine 9. Interest expense. Enter the amount of interest (subject to limitations) paid or incurred by the trust on amounts borrowed by the trust, or on debt acquired by the trust, that is not reported elsewhere in Part II.

If the proceeds of a loan were used for more than one purpose (for example, to purchase a portfolio investment and to acquire an interest in a passive activity), the fiduciary must make an interest allocation according to the rules in Temporary Regulations section 1.163-8T.

Do not include interest paid on indebtedness incurred or continued to purchase or carry obligations on which the interest is wholly exempt from income tax.Line 10a. Foreign taxes. A foreign tax includes only a tax imposed by the authority of a foreign country.Line 10b. State and local taxes. Enter any deductible state and local income or real property taxes paid or incurred during the tax year that are not reported elsewhere in Part II.

Do not deduct on line 10b or on any other line of Part II:• Federal income taxes;• Estate, inheritance, legacy, succession, and gift taxes; or• Federal duties and excise taxes.Line 11. Amortization and depreciation (depletion). A reasonable amount is allowed as a depreciation deduction for the exhaustion, wear, and tear of:• Property used in a trade or business, or• Property held for the production of income.Line 12. Trustee and advisor fees. Enter the deductible fees paid or incurred to the fiduciary for administering the trust during the tax year.Line 13. Charitable contributions. Generally, any part of the income reported on line 8 that is paid (or treated as paid) during the tax year for a charitable purpose specified in section 170(c) is allowed as a deduction. It is not

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necessary that the charitable organization be created or organized in the United States.Line 14. Other expenses. Enter other items of expense not listed on lines 9 through 13. List the type and amount on an attached statement if the trust has more than one item.Lines 17b and 17c. Distributions to U.S. owners and beneficiaries. Separately list the total amount of distributions (including the uncompensated use of trust property) to each U.S. owner and beneficiary. List the full name, identification number, date of distribution, and FMV on the date of distribution (dollar amount) for each U.S. owner and beneficiary receiving a distribution. If more space is needed, attach a statement.

Prepare a separate Foreign Grantor Trust Owner Statement (see below) or Foreign Grantor Trust Beneficiary Statement (see below) for each U.S. owner or for each U.S. beneficiary who receives a distribution from the trust.Part III—Foreign Trust Balance SheetList all assets and liabilities of the trust, including those assets and liabilities attributable to the portion(s) of the trust (if any) not treated as owned by a U.S. person.

The balance sheet should reflect FMV. Include certificates of deposit as cash on line 1.Line 18. Accumulated trust income. Include the total amount of trust income accumulated and not distributed.Foreign Grantor Trust Owner StatementA copy of this statement (pages 3 and 4 of Form 3520-A) must be (a) furnished to each U.S. person who is treated as an owner of the foreign trust under the grantor trust rules, and (b) included with this Form 3520-A. The statement must be furnished to each U.S. owner no later than the 15th day of the 3rd month following the end of the trust's tax year, or later if an extension of time to file is granted. See When and Where To File, earlier.Identification numbers and addresses. See the instructions for Part I, earlier, for information on entering identification numbers and addresses.Line 8. Trust documents. If the trust did not appoint a U.S. agent, list the documents attached to the current year Form 3520-A and those attached to a Form 3520-A filed within the last 3 years. Specify the years the documents were attached. See the instructions for line 2 under, Part I, earlier, for a list of documents the trust is required to attach to Form 3520-A.Statement of Foreign Trust Income Attributable to U.S. OwnerThe amounts on the statement must include the portion of income reported by the foreign trust deemed attributable to the U.S. owner.

The foreign trust may need to furnish to the U.S. owner additional information, including applicable statements, to ensure that the owner accurately reports income and expenses on the owner's U.S. income tax return.

Foreign Grantor Trust Beneficiary StatementA copy of this statement (page 5 of Form 3520-A) must be (a) furnished to each U.S. beneficiary who receives a distribution, directly or indirectly, from the foreign trust during the tax year; and (b) included with this Form 3520-A. See the definitions for “U.S. beneficiary” and “distribution” provided earlier in these instructions.Exception. Do not complete this statement for a U.S. person for any portion of the trust of which that U.S. person is treated as the owner; instead, complete the Foreign Grantor Trust Owner Statement for that U.S. person (as described above).

The statement must be furnished to the U.S. beneficiary no later than the 15th day of the 3rd month following the end of the trust's tax year, or later if an extension of time to file is granted. See When and Where To File, earlier.Identification numbers and addresses. See the instructions for Part I, earlier, for information on entering identification numbers and addresses.Paperwork Reduction Act Notice. We ask for the information on this form to carry out the Internal Revenue laws of the United States. You are required to give us the information. We need it to ensure that you are complying with these laws and to allow us to figure and collect the right amount of tax.

You are not required to provide the information requested on a form that is subject to the Paperwork Reduction Act unless the form displays a valid OMB control number. Books or records relating to a form or its instructions must be retained for as long as their contents may become material in the administration of any Internal Revenue law.

The time needed to complete and file the form will vary depending on individual circumstances. The estimated average time is:

Recordkeeping. . . . . . . . . . . . . . . . . 37 hr., 18 min.Learning about the law or the form . . . . . . . . . . . . . . . . . . . . . . . . . 2 hr., 40 min.Preparing and sending the form to the IRS . . . . . . . . . . . . . . . . . . . . . . . 3 hr., 24 min.

If you have comments concerning the accuracy of these time estimates or suggestions for making this form simpler, we would be happy to hear from you. You can send us comments from IRS.gov/FormComments. Or you can send your comments to: Internal Revenue Service, Tax Forms and Publications Division, 1111 Constitution Ave. NW, IR-6526, Washington, DC 20224. Do not send the form to this office. Instead, see When and Where To File, earlier.

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