Who actually files Form 3520-A, and why is it due before my tax return?

The trustee of the foreign trust files it, and it’s due by the 15th day of the 3rd month after the trust’s tax year ends, which is 15 March for a calendar-year trust. That lands a month before a US individual return. If the trust never files, the US owner has to attach a substitute version to their own Form 3520, and that copy runs on a different deadline.

Who is actually required to file Form 3520-A?

The form is the trust’s return and the trustee signs it. But the enforcement sits on you. If you’re treated as the owner of any portion of a foreign trust under the grantor trust rules, the statute makes you responsible for seeing that the trust does its part, which is why a failure by a foreign trustee becomes your problem rather than theirs. The instructions are equally direct about signatures. The trustee signs the trust’s own form, and the US owner signs a substitute.

“such person shall submit such information as the Secretary may prescribe with respect to such trust for such year and shall be responsible to ensure that” the trust files the required return and furnishes the required statements IRC 6048(b)(1)

That responsibility is the whole design of this form. A foreign trustee with no US connection has little reason to file an IRS return, and the Code’s answer isn’t to chase the trustee. It’s to put the consequence on the US owner who benefits from the trust.

When is it due, and why is that earlier than my return?

The trust’s year end drives it rather than yours. The instructions to Form 3520-A say the form “is due by the 15th day of the 3rd month after the end of the foreign trust’s tax year”, so a calendar-year trust is on 15 March. A US individual’s Form 3520 runs with their personal income tax return, which for most people is 15 April. The gap is about a month, and it’s the reason people who plan around their own filing date arrive late without realising.

“Form 3520-A is due by the 15th day of the 3rd month after the end of the foreign trust’s tax year. However, a substitute Form 3520-A attached to a U.S owner’s Form 3520 is due the same day as Form 3520.” Instructions for Form 3520-A, Reminders

Which filing	Due	Who signs it
The trust’s own Form 3520-A	15th day of the 3rd month after the trust’s year end	The trustee of the foreign trust
A substitute Form 3520-A	The same day as the US owner’s Form 3520	The US owner
Extension for the trust’s Form 3520-A	Form 7004, by the 15th day of the 3rd month	Filed using the trust’s EIN

What happens if the foreign trust never files it?

You file a substitute yourself, and doing so is what protects you from the penalty for the trust’s failure. The instructions set this out as an obligation rather than an option, and they attach it to your Form 3520 rather than leaving it floating. The substitute carries the owner statement and the beneficiary statement that form the back pages of the form, and copies of those still have to reach the people they name.

“If a foreign trust fails to file Form 3520-A, the U.S. owner must complete and attach a substitute Form 3520-A for the foreign trust to the U.S. owner’s Form 3520 … to avoid being subject to the penalty for the foreign trust’s failure to file a Form 3520-A.” Instructions for Form 3520-A

The deadline point is stated explicitly in the instructions and it’s the part worth reading twice. The substitute goes in “by the due date of the U.S. owner’s Form 3520 (and not the due date for Form 3520-A)”. The instructions then give the worked case themselves: a substitute completed to the best of the owner’s ability and attached to the Form 3520 by its due date, “such as April 15 for the U.S. owners who are individuals”, is considered timely filed.

Does my personal extension cover it?

No, and this is the second trap. An extension of your income tax return does nothing for the trust’s form. The extension for Form 3520-A is a separate filing, on Form 7004, and it has to be filed using the trust’s own employer identification number rather than yours.

“An extension of time to file an income tax return does NOT extend the time to file Form 3520-A. You MUST file Form 7004 using the foreign trust’s EIN to request an extension of time to file Form 3520-A.” Instructions for Form 3520-A, When To File

Note what that requires in practice. The trust needs an EIN before you can extend its return, so a trust that has never interacted with the IRS has a prerequisite step before the extension is even available.

What is the penalty if nobody files?

It’s calculated differently from the better-known 35 percent figure, and lower. IRC 6677(a) sets a penalty of “the greater of $10,000 or 35 percent of the gross reportable amount”. For a failure under the annual-return rules in section 6048(b), which is what Form 3520-A sits under, IRC 6677(b)(2) provides that subsection (a) “shall be applied by substituting ‘5 percent’ for ‘35 percent’”.

• Whether a TFSA is a foreign trust at all, which is the prior question for many Canadians
• What TFSA reporting actually costs on a US return
• Fighting a Form 3520 penalty after the letter arrives

So the exposure on a 3520-A failure is the greater of $10,000 or 5 percent of the gross reportable amount, not 35 percent. The $10,000 floor still means a small trust can generate a penalty far larger than any tax at stake.

What should I do next?

Find the trust’s tax year end, because every date on this page counts from it rather than from your own filing date. Then ask one question of the trustee: have they filed Form 3520-A before, and will they this year. A clear no is more useful than a maybe, because it puts you on the substitute route early enough to prepare it properly rather than at the last week.

This guide is general information, not tax advice for your specific situation. Which points apply, and how, depends on your facts.