If you are a U.S. citizen or resident alien, the gift itself is not income, but more than $100,000 from a foreign individual or related donors can require Form 3520, and splitting German accounts under $10,000 does not defeat the aggregate FBAR rule.

§102(a)-(b)

Gross income does not include the value of property acquired by gift, bequest, devise, or inheritance. Subsection (a) shall not exclude from gross income- (1) the income from any property referred to in subsection (a); or (2) where the gift, bequest, devise, or inheritance is of income from property, the amount of such income.

Reporting requirements

You are required to report the receipt of foreign gifts or bequests only if the applicable threshold is exceeded. For purposes of determining the reporting thresholds, you must aggregate gifts received from related parties. For gifts or bequests from a nonresident alien or foreign estate, you are required to report the receipt of such gifts or bequests only if the aggregate amount received from that nonresident alien or foreign estate, or foreign person that you know or have reason to know are related to the nonresident alien or foreign estate, exceeds $100,000 during the taxable year.

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To calculate the threshold amount of $100,000, you must aggregate gifts from different foreign nonresident aliens and foreign estates if you know, or have reason to know, that those persons are related to each other or if one is acting as a nominee or intermediary for the other.

When and Where To File

In general, a U.S person’s Form 3520 is due on the 15th day of the 4th month following the end of such person’s tax year for income tax purposes. If a U.S. person is granted an extension of time to file an income tax return, Form 3520 is due no later than the 15th day of the 10th month following the end of the U.S. person’s tax year. Send Form 3520 to the following address. Internal Revenue Service Center P.O. Box 409101 Ogden, UT 84409.

Penalties

In addition, you may be subject to a penalty under IRC section 6039F(c) equal to five percent of the value of the gift or bequest for each month in which the gift or bequest is not reported, not to exceed 25 percent of the gift, unless you have reasonable cause for the failure to timely or accurately file.

Who pays the gift tax?

The donor is generally responsible for paying the gift tax. Under special arrangements the donee may agree to pay the tax instead.

Who must file; filing due date; how to file

A U.S. person, including a citizen, resident, corporation, partnership, limited liability company, trust and estate, must file an FBAR to report: a financial interest in or signature or other authority over at least one financial account located outside the United States if the aggregate value of those foreign financial accounts exceeded $10,000 at any time during the calendar year reported. The FBAR is an annual report, due April 15 following the calendar year reported. You’re allowed an automatic extension to October 15 if you fail to meet the FBAR annual due date of April 15. You must file the FBAR electronically through FinCEN’s BSA E-Filing System. You don’t file the FBAR with your federal tax return.

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A financial account maintained with a financial institution located outside of the U.S. is a foreign financial account. The U.S. person is the owner of record or holder of legal title, regardless of whether the account is maintained for benefit of the U.S. person or for the benefit of another person, including non-U.S. persons.

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Unmarried taxpayers. If you are not married, you satisfy the reporting threshold only if the total value of your specified foreign financial assets is more than $50,000 on the last day of the tax year or more than $75,000 at any time during the tax year. Married taxpayers filing a joint income tax return. If you are married and you and your spouse file a joint income tax return, you satisfy the reporting threshold only if the total value of your specified foreign financial assets is more than $100,000 on the last day of the tax year or more than $150,000 at any time during the tax year. Married taxpayers filing separate income tax returns. If you are married and file a separate income tax return from your spouse, you satisfy the reporting threshold only if the total value of your specified foreign financial assets is more than $50,000 on the last day of the tax year or more than $75,000 at any time during the tax year.

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Specified foreign financial assets include the following assets. 1. Financial accounts maintained by a foreign financial institution. Attach Form 8938 to your annual return and file by the due date (including extensions) for that return. Filing Form 8938 does not relieve you of the requirement to file FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR), if you are otherwise required to file the FBAR.

Substantial presence formula

You will be considered a United States resident for tax purposes if you meet the substantial presence test for the calendar year. To meet this test, you must be physically present in the United States (U.S.) on at least: 31 days during the current year, and 183 days during the 3-year period that includes the current year and the 2 years immediately before that, counting: All the days you were present in the current year, 1/3 of the days you were present in the first year before the current year, and 1/6 of the days you were present in the second year before the current year.

Resident aliens

A resident alien's income is generally subject to tax in the same manner as a U.S. citizen. If you are a resident alien, you must report all interest, dividends, wages, or other compensation for services, income from rental property or royalties, and other types of income on your U.S. tax return. You must report these amounts whether from sources within or outside the United States.

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Check the “Yes” box if at any time during 2025 you had a financial interest in or signature authority over a financial account located in a foreign country. Check the “Yes” box even if you aren't required to file FinCEN Form 114. Report on line 1 all of your taxable interest.