Why the IRS Does Not Have the Authority to Assess and Collect a Section 6039F Penalty in Connection With a Late Filed Form 3520

Why the IRS Does Not Have the Authority to Assess and Collect a Section 6039F Penalty in Connection With a Late Filed Form 3520

Tax Law
By Anthony Diosdi There are a number of cases challenging the IRS’s ability to assess and collect penalties associated with failing to timely disclose foreign gifts on a Form 3520 making their way through various federal courts. This article discusses the IRS’s statutory ability to assess and collect Section 6039F Penalties associated with failing to timely disclose a foreign gift on a Form 3520. Introduction Section 6039F of the Internal Revenue Code requires U.S. persons (other than certain exempt organizations) to furnish information regarding the gifts (including bequests) that such person receives from a non-U.S. donor if the U.S. person treats the property so received as a gift for tax purposes, and the aggregate value of such gifts from the donor in a taxable year exceeds an annual threshold, which…
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