Defining Domestic and Foreign Trusts The Internal Revenue Code, Sec. 7701, defines any trust other than a trust that is a United States person, such as, a domestic trust, as a foreign trust. Under ...

Activities within a foreign trust are reported on IRS Form 3520 – Annual Return To Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts, or IRS Form 3520-a – Annual ...

Both a foreign trust and a U.S. person may file for an extension of time to file. Where To File. U.S. persons do not file the Form 3520-A (or the Form 3520) with their income tax return.

If any of the trustees or beneficiaries of a trust change to a foreign person, the trust-reporting requirements, income tax features and capital gains tax features will change.