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Income received as a regular interest holder of a real

Federal income taxes.

estate mortgage investment conduit (REMIC).

Estate, inheritance, legacy, succession, and gift taxes.

Federal duties and excise taxes.

For taxable bonds acquired after 1987, amortizable

State and local sales taxes. Instead, treat these taxes

bond premium is treated as an offset to the interest

as part of the cost of the property.

income instead of as a separate interest deduction. See

Pub. 550, Investment Income and Expenses.

Line 11. Amortization and depreciation (depletion). A

reasonable amount is allowed as a depreciation deduction

Line 2. Dividends. Report all ordinary dividends

for the exhaustion, wear, and tear of:

received during the tax year.

Property used in a trade or business or

Note. Report capital gain distributions on line 5.

Property held for the production of income.

Line 4. Income (loss) from partnerships, fiduciaries,

Line 12. Trustee and advisor fees. Enter the

etc. Enter the trust's share of income or (losses) from

deductible fees paid or incurred to the fiduciary for

partnerships, S corporations, estates, other trusts, and

administering the trust during the tax year.

REMICs.

Line 13. Charitable contributions. Generally, any part

If the trust received a Schedule K-1 from a partnership,

of the income reported on line 8 that is paid (or treated as

S corporation, or other flow-through entity, use the

paid) during the tax year for a charitable purpose specified

corresponding lines on Form 3520-A to report the interest,

in section 170(c) is allowed as a deduction. It is not

dividends, capital gains, etc., from the flow-through entity.

necessary that the charitable organization be created or

organized in the United States.

Line 5. Capital gains (losses). For capital gains or

(losses) attributable to a U.S. owner, use Schedule D

Line 14. Other expenses. Enter other items of expense

(corporate or individual, whichever applies) and Form

not listed on lines 9 through 13. List the type and amount

8949, Sales and other Dispositions of Capital Assets, if

on an attached statement if the trust has more than one

applicable.

item.

Line 6. Ordinary gains (losses). Enter the ordinary gain

Lines 17b and 17c. Distributions to U.S. owners and

or (loss) from the sale or exchange of property other than

beneficiaries. Separately list the total amount of

capital assets and also from involuntary conversions

distributions (including the uncompensated use of trust

(other than casualty or theft).

property) to each U.S. owner and beneficiary. List the full

name, identification number, date of distribution, and FMV

Line 7. Other income. Enter other items of income not

(dollar amount) for each U.S. owner and beneficiary

included on lines 1 through 6. List the types and amounts

receiving a distribution. If more space is needed, attach a

on an attached statement if the trust has more than one

statement.

item.

Prepare a separate Foreign Grantor Trust Owner

Items to be reported on line 7 include any part of a total

Statement (see below) or Foreign Grantor Trust

distribution shown on Form 1099-R, Distributions From

Beneficiary Statement (see below) for each U.S. owner

Pensions, Annuities, Retirement or Profit-Sharing Plans,

or for each U.S. beneficiary who receives a distribution

IRAs, Insurance Contracts, etc., that is treated as ordinary

from the trust.

income. For more information, see the instructions for

Form 4972, Tax on Lump-Sum Distributions.

Part III—Foreign Trust Balance Sheet

Expenses

List all assets and liabilities of the trust, including those

assets and liabilities attributable to the portion(s) of the

Line 9. Interest expense. Enter the amount of interest

trust (if any) not treated as owned by a U.S. person.

(subject to limitations) paid or incurred by the trust on

amounts borrowed by the trust, or on debt acquired by the

The balance sheet should reflect FMV. Include

trust, that is not reported elsewhere in Part II.

certificates of deposit as cash on line 1.

If the proceeds of a loan were used for more than one

Line 18. Accumulated trust income. Include the total

purpose (for example, to purchase a portfolio investment

amount of trust income accumulated and not distributed.

and to acquire an interest in a passive activity), the

Foreign Grantor Trust Owner

fiduciary must make an interest allocation according to the

rules in Temporary Regulations section 1.163-8T.

Statement

Do not include interest paid on indebtedness incurred

A copy of this statement (page 3 of Form 3520-A) must be

or continued to purchase or carry obligations on which the

furnished to each U.S. person who is treated as an owner

interest is wholly exempt from income tax.

of the foreign trust under the grantor trust rules. The

Line 10a. Foreign taxes. A foreign tax includes only a

statement must be furnished to each U.S. owner no later

tax imposed by the authority of a foreign country.

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

Line 10b. State and local taxes. Enter any deductible

granted. See When and Where To File, earlier.

state and local income or real property taxes paid or

incurred during the tax year that are not reported

Identification numbers and addresses. See the

elsewhere in Part II.

instructions for Part I earlier, for information on entering

identification numbers and addresses.

Do not deduct on line 10b or on any other line of Part II:

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Instructions For Form 3520-A - Annual Information Return Of Foreign Trust With A U.s. Owner - 2015 Page 6

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