What Is the Difference Between Form 8938 and Form 3520?
Form 8938 reports foreign financial assets you own or have an interest in, like bank accounts, brokerage accounts, and foreign stock. Form 3520 reports specific transactions: foreign gifts over $100,000, foreign inheritances over $100,000, and any transactions with foreign trusts. Form 8938 is about what you hold; Form 3520 is about what you received or transferred (IRS: Form 8938).
- Form 8938: ongoing annual report of foreign assets above the threshold
- Form 3520: event-driven report triggered by a specific gift, bequest, or trust transaction
- Both can apply in the same year if you receive a large foreign inheritance and the inherited assets push your holdings above the FATCA threshold
- Neither form creates a tax liability on its own; they are information returns with steep penalties for non-filing
| Feature | Form 8938 | Form 3520 |
| What it reports | Foreign financial assets you hold | Foreign gifts, inheritances, trust transactions |
| Trigger | Asset value exceeds threshold | Transaction occurs above threshold |
| Threshold (expats abroad) | $200,000 year-end / $300,000 peak (single) | $100,000 for gifts/bequests from individuals |
| Filed with | Form 1040 (attached) | Separate filing, same deadline as Form 1040 |
| Penalty | $10,000 initial + $10,000 per 30-day period | 35% of trust amount; 25% of gift amount (5%/month) |
| Ongoing? | Yes, every year assets exceed threshold | Only in years with reportable transactions |
Example: your foreign parent gives you $200,000. You file Form 3520 to report the gift. If you deposit the money into a foreign bank account that pushes your total foreign accounts above the Form 8938 threshold, you also report the account on Form 8938 going forward. The gift itself is not taxable income, but failing to report it on Form 3520 triggers a penalty of up to $50,000 (25% of $200,000).
For more, see our Form 3520 and Form 8938 guides.
Last updated on April 29, 2026
