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10 are different for various transfers, complete a separate

Specific Instructions

line for each transfer on duplicate copies of the relevant

pages of the form.

Line 7a. If “Yes,” you must comply with the reporting

Period Covered

requirements that would apply to a direct transfer to that

other person. For example, if that other person is a

File the 2001 return for calendar year 2001 and fiscal

foreign partnership, you must comply with the reporting

years that begin in 2001 and end in 2002. For a fiscal

requirements for transfers to foreign partnerships (see

year, fill in the tax year space at the top of the form.

Form 8865, Return of U.S. Persons with Respect to

Item A—Initial Return, Final Return,

Certain Foreign Partnerships).

Line 8. If the transfer was a completed gift (see

Amended Return

Regulations section 25.2511-2) or bequest, you may

have to file Form 706, United States Estate (and

Initial return. If this is the first return you are filing

Generation-Skipping Transfer) Tax Return, or Form 709,

concerning the foreign trust identified, check the “Initial

United States Gift (and Generation-Skipping Transfer)

return” box.

Tax Return.

Final return. If no further returns for transactions with

Line 9. See definition of U.S. beneficiary on page 4.

the foreign trust are required, check the “Final return”

box.

Line 10. If you are treated as the owner of any portion of

the foreign trust under the grantor trust rules, answer

Example. If you annually filed Part II, Form 3520,

“Yes” to this question and complete Part II.

because you were the owner of the trust for U.S. income

tax purposes and the trust has terminated within the tax

Schedule A—Obligations of a Related Trust

year, that year’s return would be a final return with

respect to that foreign trust.

Line 11a. The FMV of an obligation of the trust (or an

obligation of another person related to the trust) that you

Amended return. If this Form 3520 is filed to amend a

receive in exchange for the transferred property equals

Form 3520 that you previously filed, check the “Amended

zero, unless the obligation meets the requirements of a

return” box.

qualified obligation. See page 3 for the definitions of

obligation and qualified obligation. See page 4 for the

Identifying Information

definition of person related to a foreign trust.

Identification numbers. Use social security numbers or

Lines 12 and 26. If you answered “Yes” to the question

individual taxpayer identification numbers to identify

on line 11b (line 25, column (e)) with respect to any

individuals. Use employer identification numbers to

obligation, you generally must answer “Yes” to the

identify estates, trusts, partnerships, and corporations.

question on line 12 (line 26). By so doing, you agree to

Address. Include the suite, room, or other unit number

extend the period of assessment of any income or

after the street address. If the post office does not deliver

transfer tax attributable to the transfer and any

mail to the street address and the U.S. person has a P.O.

consequential income tax changes for each year that the

box, show the box number instead.

obligation is outstanding. This form will be deemed to be

consented to and signed by the Service Center Director

Foreign address. Enter the information in the following

or the Director, International for purposes of Regulations

order: city, province or state, and country. Follow the

section 301.6501(c)-1(d).

country’s practice for entering the postal code, if any.

Please do not abbreviate the country name.

If you answer “No” to the question on line 12 (line 26),

you generally may not treat an obligation as a qualified

Line 1. This line identifies the U.S. person that is filing

obligation on line 11b (line 25, column (e)). The one

Form 3520. If you and your spouse are both making

exception to this is if the maturity date of the obligation

transfers to the same trust and you file joint returns, you

does not extend beyond the end of your tax year for

may file only one Form 3520. Put the names and

which you are reporting and such obligation is paid within

taxpayer identification numbers in the same order as they

that tax year.

appear on your Form 1040.

Line 4. If you are the executor of the estate of a U.S.

Schedule B—Gratuitous Transfers

citizen or resident, you must identify the decedent on this

Complete the applicable portions of Schedule B with

line.

respect to all reportable events (as defined on page 4)

that took place during the current tax year.

Part I—Transfers by U.S. Persons to a

Line 13

•

Foreign Trust During the Current Tax

In your description, indicate whether the property is

tangible or intangible.

Year

•

You may aggregate transfers of cash during the year

Complete Part I for information on a reportable event

on a single line of line 13.

•

(defined on page 4).

If there is not enough space on the form, please attach

Line 5. If you are not the trust creator, enter the name of

a statement.

•

the person that created or originally settled the foreign

For transfers reported on attachments, you must enter

trust.

“Attachment” on one of the lines in column (b), and enter

the total amount of transfers reported on the attachment

Line 6. See the list of country codes on pages 11 and 12

on line 13, columns (c), (d), (e), (f), (h), and (i).

of these instructions. If the country is not included in the

Note: Penalties may be imposed for failure to report all

list, enter “OC” for “other country” and enter the country’s

required information. See Item 1 of Penalties on page 2.

name.

Lines 7, 8, and 10. If you are reporting multiple transfers

Line 13, column (e). Only include gain that is

to a single foreign trust and the answers to lines 7, 8, or

immediately recognized at the time of the transfer.

-5-

Instructions For Form 3520 - Annual Return To Report Transactions With Foreign Trusts And Receipt Of Certain Foreign Gifts - 2001 Page 5

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