Kathy, I thought of something I hadn't earlier, if you didn't get the reference to that online website you mentioned from the IRS page of online services, you should be cautious about using it. If you've already used it, and have any doubts, you probably should contact the fraud unit of your credit card company.
After reading the instructions for the NEW Form 8938, I do believe that anyone with a grantor trust must file this form. The thing is, to reduce "duplicative reporting" (LOL), you don't have report a "specified foreign asset on the Form 8938" if you have already reported it on another Form such as 3520-A or 3520 (other Forms mentioned too). BUT you must fill out Part IV of 8938 indicating which Forms you have shown the info on... http://www.irs.gov/pub/irs-pdf/i8938.pdf To V: Thank you for sharing the words that you used to satisfy Form 3520-A, page 3, line 7. I used it as a start and added a few things. To BVG_Steve: For your sake I hope that your US accountant and your Mexican attorney are steering you in the right direction by advising you NOT to bother with 3520-A, 3520 and now Form 8938 in the US and not having to file in Mexico on your Mexican rental income. IMO, in the US especially with so much uncertainty and seemingly no one at the IRS having a unified understanding of what is required, I'd think that erring on the safe side by filing would be the wisest course. Likewise in Mexico since there is tax reciprocity between the US and Mexico so one is not paying double. Mexico Law Taxation RENTAL OF MEXICAN PROPERTY- US IRS TAX RULES & YOUR QUESTIONS ANSWERED
Steve, you might have a look at Form 3520, again: on page 4, Part II, it requires information from the U.S. owner of a foreign trust. There, the owner is asked about such things as the country in which the trust was created, the law which governs the trust, the date the trust was created; then, and more importantly for this discussion, at Part II, line 22, asks if the trust has filed Form 3520a for the year. If the answer is "no", the owner is then asked to do the following, "If No, to the best of your ability, complete and attach a substitute Form 3520a for the foreign trust." There is no escaping from the owner's obligation to see that a Form 3520a be filed, each year: if one is not filed by another, he must do it himself- so reads the forms, and the instructions. Especially in the case in which all income and expenses are being otherwise reported, it makes little sense to chance skipping making these reports, with the enormous penalties the law proposes to impose on those who do.
Some of you will have missed the March 15 deadline, this year, for filing Form 3520a for 2011. If that has happened to you for any reason, perhaps you can take heart in what is said on Form 3520, which is not due to be filed until the time your tax return is due. At Part II, line 22, it asks if the trust has already filed Form 3520a. If the answer is "no", the owner is then asked to do the following, ""If "No", to the best of your ability, complete and attach a substitute Form 3520a for the foreign trust."" There is no escaping from the owner's obligation to see that a Form 3520a be filed, each year: if one is not filed by another (which in some cases might be a trustee who is truly acting in that capacity), he must do it himself- so reads the forms, and the instructions. ___________________________ I'd like to make a few more comments which may clear up some people's understanding of where they stand in relation to a fideicomiso in which they have an interest. The fideicomiso is an entity separate and apart from you, as a person; yet, you stand in a legal relation to it, as defined by the trust instrument, and the U.S. tax law. You may be, as most are in the fideicomisos I've seen, an owner of the trust. As such, you have both the power and the duty to act to meet the reporting requirements (see above, for example). I am, by the terms of my fideicomiso, also appointed trustee of the trust, and I'm told most fideicomisos read this way. If you want to see and read your trust instrument, just pull out your escritura: you will find the bulk of its pages are devoted to establishing the trust, and setting out the respective duties of the parties to it. In most fideicomisos, the bank is a passive party to the trust, specifically disavowing itself of any duty to care for, or mangage the trust property; nor does it take on any of the reporting requirements of U.S. tax law. That duty is left squarely to others- the owner/trustees of the trust. In my trust instrument this is made clear by the bank's referring to itself merely as a "fiduciary" (whose role is no more than holding bare legal title to the property), while assigning all other rights and duties to others- which, in the case of my fideicomiso, is just me, and my wife (who would kill me if I didn't take care of things like this!).
Some of you will have missed the March 15 deadline, this year, for filing Form 3520a for 2011. If that has happened to you for any reason, perhaps you can take heart in what is said on Form 3520, which is not due to be filed until the time your tax return is due. At Part II, line 22, it asks if the trust has already filed Form 3520a. If the answer is "no", the owner is then asked to do the following, ""If "No", to the best of your ability, complete and attach a substitute Form 3520a for the foreign trust."" This implies a chance to do what should have been done, earlier. That should be good for at least one reporting year, after which it will be obvious that you knew of the requirement: since the penalties attach only to "willful" neglect to file, the next year you will need to file on time, having become aware of the requirement. ___________________________ I'd like to make a few more comments which may clear up some people's understanding of where they stand in relation to a fideicomiso in which they have an interest. The fideicomiso is an entity separate and apart from you, as a person; yet, you stand in a legal relation to it, as defined by the trust instrument, and the U.S. tax law. You may be, as most are in the fideicomisos I've seen, an owner of the trust. As such, you have both the power and the duty to act to meet the reporting requirements (see above, for example). I am, by the terms of my fideicomiso, also appointed trustee of the trust, and I'm told most fideicomisos read this way. If you want to see and read your trust instrument, just pull out your escritura: you will find the bulk of its pages are devoted to establishing the trust, and setting out the respective duties of the parties to it. In most fideicomisos, the bank is a passive party to the trust, specifically disavowing itself of any duty to care for, or mangage the trust property; nor does it take on any of the reporting requirements of U.S. tax law. That duty is left squarely to others- the owner/trustees of the trust. In my trust instrument this is made clear by the bank's referring to itself merely as a "fiduciary" (whose role is no more than holding bare legal title to the property), while assigning all other rights and duties to others- which, in the case of my fideicomiso, is just me, and my wife (who would kill me if I didn't take care of things like this!).
