Foreign Gift Reporting (Form 3520) for Immigrants
Updated April 12, 2026
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Quick answer
US residents who receive gifts or inheritances from foreign persons exceeding $100,000 in a calendar year must file Form 3520. The gift itself is not taxable income, but failure to report carries a penalty of 25% of the gift amount.
Your Parents Sent You Money From Abroad - Now What?
Receiving money from family members in your home country is common for immigrants. Good news: the gift is not income and you do not owe income tax on it. The issue is reporting. The IRS requires US persons who receive large gifts from foreign individuals to file Form 3520, an information return.
Who Must File Form 3520
You must file Form 3520 if you are a US person (citizen, green card holder, or resident alien) and you received:
- More than $100,000 in gifts or inheritances from one or more foreign individuals during the calendar year (gifts are aggregated across all foreign individual donors)
- More than $18,939 (2024 threshold, adjusted annually) in gifts from foreign corporations or foreign partnerships
- Certain distributions from foreign trusts
The $100,000 threshold aggregates all gifts from all foreign individuals - not each person separately. Three relatives each sending $40,000 equals $120,000 total, which crosses the threshold.
Gifts Are Not Taxable Income
This is the most important point: a gift from a foreign person is not taxable income. You report the gift on Form 3520 as an informational matter only. You do not pay US income tax on the amount received.
The same rule applies to inheritances from foreign persons - they are not income, but they may need to be reported.
The Penalty for Not Filing
The penalty for failing to file Form 3520 when required is 25% of the value of the gift. This is not a tax on the gift - it is a separate civil penalty for non-compliance. For a $200,000 wire transfer from parents, that is a $50,000 penalty.
The IRS does have a reasonable cause exception, but it requires documentation and is not automatic.
When and How to File
Form 3520 is due on the same date as your income tax return, including extensions. If you file an extension for your 1040 (October 15), your Form 3520 is also extended to October 15.
Form 3520 is filed by mail - it cannot be e-filed. Mail it to:
Internal Revenue Service Center
P.O. Box 409101
Ogden, UT 84409
Common Scenarios
| Scenario | Taxable? | Report on 3520? |
|---|---|---|
| Parents send $150,000 wire from Brazil | No | Yes |
| Grandparent leaves you a $200,000 inheritance | No | Yes |
| Friend sends $50,000 as a gift | No | No (under threshold) |
| Foreign corporation pays you $20,000 "gift" | Possibly wages/income | Yes (exceeds corp threshold) |
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Start Free DiagnosticCommon Questions
No. A gift from a foreign person is not taxable income in the US. You owe no income tax on the money itself. However, if the total gifts you received from all foreign individuals combined exceeded $100,000 during the year, you must report the amount on Form 3520.
The threshold is $100,000 in aggregate gifts from all foreign individuals during the calendar year. For gifts from foreign corporations or partnerships, the threshold is much lower - $18,939 for 2024 (adjusted annually for inflation). Each gift does not have to exceed the threshold separately; it is the combined total that matters.
The penalty for failing to file Form 3520 is 25% of the value of the gift or bequest you received. This can be a very large number if your parents sent you a substantial sum. The IRS can also impose additional penalties for continued failure to file.
This article is educational information only. It is not tax, legal, or financial advice. For decisions specific to your situation, consult a licensed CPA or Enrolled Agent.