RESP tranferred to grandparents

DaveM · Post by **DaveM** » Wed Feb 11, 2015 12:28 pm

Thanks nelsona for the reply - it makes sense & now I can move on. I will finally be done with 3520/a & FBAR forms forever in a few months.

areefer · Post by **areefer** » Sat Feb 21, 2015 5:19 pm

Hi DaveM -

Did you fill out Part I of 3520?

In reading the instructions, it seems to me that this section needs to be filled out to indicate the transfer from a US person to another foreign trust (the new one that is not owned by a US person).

Thanks.

DaveM · Post by **DaveM** » Sun Feb 22, 2015 2:04 pm

Yes, I will be filling out 3250 Part I. My plan will be to:

Line 7a: Check 'Yes'.

Lines 7b: Fill the information about the person who will be the owner/trustee of the RESP to which the assets are being transferred.

Line 8: Check 'Yes'. I believe this is consistent with the representation in Form 3250A that 'no consideration was received' in return for the transfer of assets (and also the fact that 3250 Part I, Line 11a below will be checked 'No'). Luckily for me, the amount being tranferred falls just under the threshold (for a joint tax return situation) that would require gift taxes.

Lines 9a & 9b: Check 'No'

Line 11a: Check 'No'

Line 10: Check 'No' (I look on this as one of the crucial entries.)

areefer · Post by **areefer** » Sun Feb 22, 2015 6:08 pm

Thanks DaveM

I agree with your plan. In addition, I'm also going to:

Line 13: Check "Yes" - since this is a gift with 'no consideration'.

I'll fill out the table and ensure that column (d) is the cost basis of the RESP when we entered the US.

While the total amount of our RESP being transferred is greater than the gift exemption, when taking the adjusted cost basis in to account, it is below the exemption. So I'm assuming I don't need to worry about gift taxes.

Line 19: Check "No"