Estate Planning and Tax Practitioners Beware! IRS Offshore Trust Compliance Approaches.

A kind reminder to fellow Estate Planning and Tax practitioners that March 15th is the deadline for filing IRS Form 3520-A, the Annual Information Return of Foreign Trusts with a U.S. Owner (or filing an extension via form 7004). The IRS requires the 3520-A to be filed when there is a foreign/offshore trust with a U.S. owner for income reporting requirements.

With penalties subjecting the U.S. owner to the greater of $10,000 or 5% of the gross value of the trust assets, this one is worth putting on the calendar. Other irrevocable trust compliance (domestic and/or onshore) such as Form 3520, 1041, 1040NR, 709 gift tax returns, and any California specific requirements such as the 541 are upcoming as well but with a 4/15 deadline or last day to extend.