Who Must File...

• If you are a US Person who receives foreign gifts of money or other property over $100,000 (or $15,601 if received from a foreign corporation or partnership) must report the gift on Form 3520.

Penalties for Non-Compliance

• The penalty for failure to report a large gift (or bequest) from a foreign person on a timely, complete, and accurate Form 3520 is 5% of the amount of such foreign gift (or bequest) for each month for which the failure continues after the due date of the reporting U.S. person’s income tax return (not to exceed 25% of such amount in the aggregate). IRM 20.1.9.10.4.

Who Must File...

• If you are a US citizen or permanent resident living abroad or a citizen or resident living in the US, you must report your interest in any foreign corporations if you have a specified relationship with the corporation and own or have control over a specified percentage of the total value of the corporation.

Penalties for Non-Compliance

• The noncompliance penalty adjustment permits the Service, in its sole discretion, to deny deductions and adjust the cost of goods sold with respect to the related party transaction(s) based upon information available to the Service. IRC 6038(d)(3).

Who Must File...

• U.S. persons, domestic corporations or domestic estates or trusts must file Form 926, Return by a U.S. Transferor of Property to a Foreign Corporation, to report any exchanges or transfers of property (as described in section 6038B(a)(1)(A) of the Internal Revenue Code) to a foreign corporation.

Penalties for Non-Compliance

• Anyone who fails to any exchanges or transfers of specified foreign properties must pay a penalty equal to 10 percent of the fair market value of the property at the time of the exchange. IRC § 6038B.

Who Must File...

• This form is filed with your US tax return if you own 10% or more of a foreign partnership or foreign Flow through LLC. This form shows the income and expense statement of the foreign partnership and the yearly balance sheet. It also reports details of the partnership and your allocable share of the partnership income. It is similar to Form 1065 which is filed for a US based partnership or LLC.

Penalties for Non-Compliance

• The initial penalty is $10,000 per failure.
• If any failure continues more than 90 days after the day on which the notice of such failure was mailed to the taxpayer (90-day period), additional penalties of $10,000 for each 30-day period (or fraction thereof) during which such failure continues after the expiration of the 90-day period will apply. The maximum continuation penalty is limited to $50,000 per failure.
• The maximum total penalty under IRC 6679 is $60,000 per failure (an initial penalty maximum of $10,000 plus the continuation penalty maximum of $50,000 per failure).

Who Must File...

• A foreign trust with a U.S. owner must file Form 3520-A in order for the U.S. owner to satisfy its annual information reporting requirements under section 6048(b). Each U.S. person treated as an owner of any portion of a foreign trust under the grantor trust rules (sections 671 through 679) is responsible for ensuring that the foreign trust files Form 3520-A and furnishes the required annual statements to its U.S. owners and U.S. beneficiaries.

Penalties for Non-Compliance

• The U.S. owner is subject to an additional separate penalty equal to the greater of $10,000 or 5% of the gross value of the portion of the trust's assets treated as owned by the U.S. person at the close of that tax year, if the U.S. owner (a) fails to file a timely Form 3520 (Part II), or (b) fails to furnish all of the information required by section 6048(b) or includes incorrect information. See section 6677(a) through (c) and the Instructions for Form 3520.
• Additional penalties will be imposed if the noncompliance continues for more than 90 days after the IRS mails a notice of failure to comply with the required reporting. For more information, see section 6677.
• Criminal penalties may be imposed under sections 7203, 7206, and 7207 for failure to file on time and for filing a false or fraudulent return.
• Penalties may also be imposed under section 6662(j) for undisclosed foreign financial asset understatements.

Who Must File...

• The person who pays the premium to the foreign insurer (or to any nonresident person such as a foreign broker) must pay the tax and file the return. Otherwise, any person who issued or sold the policy, or who is insured under the policy, is required to pay the tax and file the return.

Penalties for Non-Compliance

• It appears that the penalties for late filing, late payment or non filing of this return are the same as for late filing, late payment or non filing of income tax returns and the penalties are based on the amount of taxes that are due with the return.

Who Must File...

• Generally a U.S. person that is a direct or indirect shareholder of a PFIC must file Form 8621 for each tax year.

Penalties for Non-Compliance

• It appears that the penalties for late filing, late payment or non filing of this return are the same as for late filing, late payment or non filing of income tax returns and the penalties are based on the amount of taxes that are due with the return.