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  1. Form 3520A is just for U.S. owners of foreign trusts. “Owners” means that the foreign trust is a grantor trust with a U.S. person as the grantor, under the principles of Sections 671-679 of the Code.

    So if there are no U.S. owners, you would not do the Form 3520-A.

    If you have a U.S. beneficiary, you are going to be in the territory of having that beneficiary file a Form 3520. The beneficiary will need a Foreign Nongrantor Trust Beneficiary Statement in order to avoid using the default calculations for taxation of accumulation distributions. See the instructions to Line 30 of Form 3520. If you have accurate trust accounting information to prepare that, all is well. Go look at Notice 97-34 for all of the painful details of what is included.

  2. Assuming good account records exist, can a Form 3520A be completed for a US beneficiary of a foreign non-grantor trust that does not have any US owners?

  3. Very helpful, thank you. Does the accumulation distribution shown on line 37 of Schedule A get included on the Form 1040 anywhere?

  4. @Susan,

    I’m a bit slammed for time at the moment. But I’m going to put this in Evernote on my “list of topics to blog about” because it is worth looking at and writing about.


  5. I have a question about completing line 13. The instructions say to “include in the taxable income amounts distributed in that year as a result of prior accumulation distributions”.

    So if there was a prior accumulation distribution in 2010 and when filling in 4970 for that year the three years used on line 14 were 2009, 2008 and 2007, then for an AD in 2011 are you supposed to add the prior year AD to year 2010, or to 2007, 2008 and 2009 on line 13?

  6. Very helpful!

    I have one comment:

    “Line 17 requires you to get your hands on the Tax Tables or Tax Rate Schedule for the year in question, and recalculate the new income tax based on the Line 16 recomputed taxable income amount.”

    Does this line incorporate the Alternative Minimum Tax? The instructions were never clear about this.

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Tax laws change over time, and the information in this post above may be less accurate today than it was at the time of the last revision. This post is not tax advice for your specific situation. Please contact an international tax professional to get personalized advice for your situation.