3520/3520a

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rogfed
Posts: 1
Joined: Thu Jun 18, 2020 8:27 pm

3520/3520a

Post by rogfed » Thu Jun 18, 2020 8:32 pm

Hi - Question for yall.

Does a 3520/3520A for a US citizen who has a Canadian TFSA need to be filled in when there nothing in the account - but the account is open?

Thanks yall

cqhg
Posts: 11
Joined: Fri Dec 14, 2018 11:18 pm

Re: 3520/3520a

Post by cqhg » Thu Jul 23, 2020 10:57 pm

Not report and you had better close this account immediately.

because the penalty is big ( $10,000)

MGeorge
Posts: 309
Joined: Fri Jun 22, 2012 9:23 am
Location: Canada

Re: 3520/3520a

Post by MGeorge » Wed Sep 02, 2020 12:10 pm

There is now a ruling that 3520/3520A is not required for RESPs (no update on TFSA type accounts). One thing many of us have learned is that 3520/3520A reporting is risky. Lots of incorrect robo letters with threatening fines mentioned. You could take the position that a TFSA is not a trust, there is a good argument from Max Reed on the internet about this.
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MGeorge is neither an accounting nor taxation professional.

sheri
Posts: 14
Joined: Thu Jun 10, 2010 9:53 am

Re: 3520/3520a

Post by sheri » Sat Sep 05, 2020 9:53 am

hi all,
i'm a Canadian citizen filing a 1040NR treaty based return (form 8833) for 2019 because I spent more than 183 days in the US last year. Do I still have to file a 3520/3520A for my TFSA account? I have made no contributions to my TFSAs for the last 3 years. I also own a consulting company (canadian incorp) which is unrelated to my work in the US. Do I also have to file form 5471 under a 1040NR treaty based return?

thanks so much in advance!

nelsona
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Re: 3520/3520a

Post by nelsona » Sat Sep 05, 2020 12:35 pm

No, you are neither required to file 3250's nor 5471, if you are not a US resident.

If you exceeded the 183 days but are still considered by treaty to be Cdn resident, you are correct to file 1040NR. You may not need to file 8833 however, since the 1040NR has sufficient spaces to indicate whey you are using it rather than 1040.

But there is no harm in including it.
Nelsona Non grata. Non pro. Search previous posts. Happy Browsing :D

sheri
Posts: 14
Joined: Thu Jun 10, 2010 9:53 am

Re: 3520/3520a

Post by sheri » Sat Sep 05, 2020 12:57 pm

Thanks nelsona for the quick response and so relieved to learn that I don't have to file the 3520s and 5471! Am I correct in assuming I still have to file a fincen form 114 (fbar)? If so, for the fbar - should I be disclosing the corporation accounts for my consulting company. (the consulting company had no revenues or expenses last year but has checking and savings accounts with money).

thank you again. Love this forum! Learning so much!

nelsona
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Re: 3520/3520a

Post by nelsona » Sat Sep 05, 2020 1:29 pm

You do not need FBAR either.
Nelsona Non grata. Non pro. Search previous posts. Happy Browsing :D

sheri
Posts: 14
Joined: Thu Jun 10, 2010 9:53 am

Re: 3520/3520a

Post by sheri » Sat Sep 05, 2020 2:15 pm

Thank you for clarifying nelsona. Is this a recent change because everything I'm reading online seems to indicate that a person who uses the treaty to be taxed as a US non-resident is still considered a resident for filing these information returns especially 3520s and 5471.

nelsona
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Re: 3520/3520a

Post by nelsona » Sat Sep 05, 2020 2:26 pm

I believe there is a difference if you are a Green card holder now claiming to be non-resident and electing to file as a 1040NR vs. a person who has never been US resident, such as yourself.
Nelsona Non grata. Non pro. Search previous posts. Happy Browsing :D

sheri
Posts: 14
Joined: Thu Jun 10, 2010 9:53 am

Re: 3520/3520a

Post by sheri » Sat Sep 05, 2020 2:53 pm

oh I see...is there some material you would suggest I read to gain clarity on this? Is there an IRS publication?

nelsona
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Re: 3520/3520a

Post by nelsona » Sat Sep 05, 2020 9:54 pm

You seem to have read online otherwise, so just reread these with the notion of the differnce between a GC holder an an accidental resident.
Nelsona Non grata. Non pro. Search previous posts. Happy Browsing :D

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