3520 for loan from parents

[zzazzles]

Hi all,

5 years ago, my parents loaned me some money as a down payment to buy a house. At the time (and until recently), I did not know about the need to file a 3520 if I receive a gift from a foreign person (if the gift exceeds reporting thresholds).

That was 2008, when real estate prices were in freefall. Our understanding is that, if I can make a profit flipping the house, I would repay them.

My question is, in this situation, would the IRS consider the money from my parents a gift, thereby obliging me to file a 3520?

Since there is no tax implication for this, I know I should've filed a 3520 back in 2008 just to be safe, but I learned about this just now. The fact that the 3520 is mostly used to report interests in foreign trusts makes the gift requirement so much more obscure.

Thanks for any advice!

[zzazzles]

Oh and I'm sorry but I realized I wasn't very clear.

My parents are Canadian. I am a Canadian citizen, but now also a permanent resident in the US.

My parents didn't charge me interest (which the IRS specifies) because interest rates are basically zero and we never thought about it that way.

[nelsona]

If the gift was less than $100, you never had to report it on 3520.

If it was more, you had to report it in that year, and that is all. It is a one-time gift. no tax, just report.

[CdnAmerican]

Would the statute of limitations come into play here? I can't recall if the limit for the 3520 is 3 years or 6 years.

[nelsona]

$100K is the limkitr of course, not $100.

[zzazzles]

Thanks, nelson, CdnAm.

My parents wired the funds to me twice within the same year. Together, the amount exceeded the $100k reporting threshold.

At first, I thought I didn't have to worry about it since it was so long ago, but then I read that because I didn't file the form, the statute of limitations never started. That got me worried about how I should deal with this.

[nelsona]

Ummm. File the form.