Your parents in India want to help with a house down payment, or simply send you a large amount. Do you owe US tax on it? Usually not. But you may owe the IRS a form, and missing it is expensive.
As of November 2, 2026, here is how Form 3520 works for gifts from family abroad.
- US persons file Form 3520 to report large gifts from foreign persons.
- For tax purposes, a US person includes a citizen or resident of the United States.
- Gifts from a nonresident alien are reportable only if they exceed $100,000 in the tax year.
- Gifts from related donors, such as both parents, are added together for the threshold.
- Above the threshold, each gift over $5,000 must be identified separately.
- The late-filing penalty is 5% of the gift per month, up to 25%, unless there is reasonable cause.
Is a gift from parents in India taxable in the US?
Generally not as income. The IRS defines a foreign gift as "any amount received from a person other than a U.S. person (a foreign person) that the recipient treats as a gift or bequest and excludes from gross income" (IRS, Gifts From Foreign Person). A foreign person "includes a nonresident alien individual," which covers parents living in India.
The obligation is reporting. "If you are a U.S. person" who "received a large gift or bequest from a foreign person, you need to complete Part IV of Form 3520."
Indian tax rules on the parents' side are separate, and you'd need advice from an Indian tax professional on those.
Who counts as a US person?
Not only citizens. The Form 3520 instructions say "a U.S. person is: A citizen or resident of the United States," and point to IRS Publication 519 "for guidance on determining resident alien status" (IRS, Instructions for Form 3520).
That means:
| You are | Usually a US person for this form? |
|---|---|
| Green card holder | Generally yes, as a resident for tax purposes |
| H-1B worker who meets the substantial presence test | Yes, as a resident alien |
| H-1B worker in a first partial year, or not meeting the test | Possibly not; check your status |
| US citizen | Yes |
IRS Publication 519 sets out both tests, the green card test and the substantial presence test (IRS Publication 519), and our guide to taxes for H-1B workers and green card holders explains them in plain terms.
When do you have to report?
Above $100,000 a year. The IRS says that for gifts from a nonresident alien, "you are required to report the receipt of such gifts or bequests only if the aggregate amount received from that nonresident alien" or related foreign persons "exceeds $100,000 during the taxable year" (IRS, Gifts From Foreign Person).
- Parents are added together. You must count gifts from foreign persons "that you know or have reason to know are related to the nonresident alien." So $60,000 from your father and $50,000 from your mother crosses the line.
- Each large gift is listed. "If the gifts or bequests exceed $100,000, you must separately identify each gift in excess of $5,000."
Gifts from foreign companies have a much lower threshold, "$20,573 for 2026," so a transfer from a family business is treated differently from one from a parent.
When and how do you file?
Separately from your tax return. "File Form 3520 separately from your income tax return," and in general by "the 15th day of the fourth month following the end of the U.S. person's tax year" (IRS, Gifts From Foreign Person). For most individuals, that's April 15.
If you get an extension for your income tax return, the instructions say 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" (IRS, Instructions for Form 3520).
What happens if you don't file?
The penalty is steep. "A penalty equal to 5% of the amount of such foreign gifts applies for each month for which the failure to report continues (not to exceed a total of 25%)." The IRS may also "determine the income tax consequences of the receipt of such gift" (IRS, Instructions for Form 3520).
There's an escape for honest mistakes: "No penalty will be imposed if the taxpayer can demonstrate that the failure to comply was due to reasonable cause and not willful neglect."
Does a gift affect your immigration case?
Not as a gift. But large transfers can show up in documents you later give USCIS, such as bank statements or tax returns, so keep records of where money came from. If you later want to bring your parents to the US permanently, our guide to sponsoring parents for a green card explains the steps, which have their own financial rules. Green card holders should also file as US tax residents: our guide to maintaining permanent residence explains why claiming nonresident status on a return can be treated as a sign of abandoning a green card. If the gift is for a house, our guide to buying a home on H-1B or a green card covers what lenders look at.
What this means for you
- Gifts from parents abroad generally aren't US income.
- US tax residents report gifts from nonresident aliens over $100,000 a year.
- Add gifts from both parents together for the threshold.
- File Form 3520 separately, usually by April 15.
- A missed filing can cost up to 25% of the gift.
Where to start
Family money often comes in when people settle down in the US for good. If you're planning for permanent residence, our free evaluation at /evaluate/ checks whether EB-1A or the NIW fits your profile, and Frank, our AI assistant at /frank, helps you build the evidence. Petitions are reviewed and filed by our partner law firm, Lai & Turner.
Sources
All checked November 2, 2026.
- IRS, Gifts From Foreign Person. Definition; $100,000 threshold; related donors; due date.
- IRS, Instructions for Form 3520 (12/2025). US person; extension; penalty; reasonable cause.
- IRS Publication 519. Resident alien status, including green card and substantial presence tests.
This article describes US tax rules in general terms and isn't tax advice. Green Card Guide AI is not a law firm and this article is not legal advice. It describes the rules in general terms; your attorney determines how they apply to your case.
Frequently asked questions
Do I pay US tax on money my parents in India send me?
Generally not as income. The IRS describes a foreign gift as an amount received from a foreign person that the recipient treats as a gift and excludes from gross income. What you may owe is a report: if you're a US person and the gifts from a nonresident alien exceed $100,000 in a year, you file Form 3520.
Does an H-1B worker have to file Form 3520?
Only if they are a US person for tax purposes and receive more than $100,000 in gifts from a nonresident alien in the tax year. The Form 3520 instructions define a US person to include a citizen or resident of the United States. Many H-1B workers are resident aliens under the substantial presence test, so check your tax status first.
Do gifts from my mother and father count separately?
No. The IRS says you must add together gifts received from the nonresident alien and from foreign persons you know or have reason to know are related to them. So money from both parents counts toward one $100,000 threshold. If you pass it, you list each gift over $5,000 separately.
When is Form 3520 due?
Generally by the 15th day of the fourth month after your tax year ends, which is April 15 for most individuals, with extensions available. It is filed separately from your income tax return. US citizens and residents living abroad may have a later date under the instructions.
What if I forgot to file Form 3520 for a past gift?
The penalty for not reporting a foreign gift is 5% of the gift for each month the failure continues, up to 25%. The IRS says no penalty applies if you can show the failure was due to reasonable cause and not willful neglect. Talk to a tax professional about how to report late.
Green Card Guide AI is not a law firm and this article is not legal advice. It describes evidence-building strategy in general terms; your attorney determines what belongs in your petition and how it's argued.
