I just found out that I have to fill out this form because I have a tax-free savings account, and that it's due on March 15. Are we required to fill out a 3520 for every year that we had the TFSA (in my case, since 2009) or starting with 2011?

Take a read-through of the instructions for this form http://www.irs.gov/pub/irs-pdf/i3520.pdf as it deals with foreign trusts, not savings accounts. What little I know of the TFSA's (i.e. what I found doing a quick google) indicates that this is more like a "deferred tax account" (say, an IRA or tax deferred educational account) and would be more logically reported on your US taxes as just a regular savings account. The would involve declaring the interest paid to you as it is earned and possibly paying US taxes on it - but depending on the rest of your situation, that may not involve actually paying anything.

If you treat it that way, you could then just report it as a regular old savings account and be done with it.
Cheers,
Bev

Bev, from what I understand, tax-free savings accounts outside the U.S are considered foreign trusts and have to be reported accordingly.

From The Globe and Mail http://www.theglobeandmail.com/globe...rticle1867865/: "Form 3520, Annual Return to Report Transactions with Foreign Trusts and Receipt of Certain Foreign Gifts; and Form 3520A, Annual Information Return of Foreign Trust With a U.S. Owner. These latter two forms may be required if you’ve set up RESP or TFSA accounts, for example."

I'd be cautious about applying information from the Globe and Mail too literally. Note that they do say "These latter two forms may be required if you’ve set up RESP or TFSA accounts, for example." It's not necessarily the case.

I only mention this because we have some tax free savings accounts here in France that I certainly report as regular savings accounts - declare my interest each year as income on my US tax forms - and have never had any problem with the IRS over this.

You'd have to check the instructions a bit more (or do some research on the IRS website), but I suspect that RESPs are considered "trusts" because they are "tax deferred" accounts - kind of like the US IRAs or 401K plans. But I think you could probably elect to report a TFSA (or even a RESP) as if it were a regular savings account, if you treat it as one on your US income tax forms. (This would also involve reporting it on the FBAR forms as a regular savings account - and possibly on the 8938, if your foreign accounts exceed the threshold for reporting on that form.)
Cheers,
Bev

Yeah, the only reason I pointed out that Globe and Mail article is because it seemed to support what I've been told. An accountant is telling me I need to fill out these forms, and they're due on March 15. She's saying this is new for 2011 tax returns. So I guess I'll have to make some phone calls to the IRS and maybe my previous accountant, to sort this out.

It would be really, really nice if these things were spelled out in clear language.

Why March 15th? From the instructions for form 3520:

Normally tax returns are due April 15th, and overseas returns are due June 15th.

One of the tough things about US taxes is that there IS no one "right" or "wrong" way to do things. There are loads of choices built into the system: filing jointly if you're married or filing separately; standard deduction or itemized deduction; taking foreign income taxes paid as a deduction or a tax credit; etc.

Tax accountants make their livings by suggesting ways to minimize your tax obligation, but sometimes it makes sense to pay a bit more tax now to avoid problems down the line, or to treat something in an "unconventional" manner as long as you're disclosing it completely, consistently and without trying to evade any tax obligation.
Cheers,
Bev

This is the date that my accountant gave me. However, when I check online, I'm seeing indications that Form 3520-A is due on March 15. So I will have to call her and ask her for a clarification.

And this is what makes me so angry. I want to do the right thing. But finding out how to do the right thing, in this situation, seems to be about as clear as mudflaps.

I have no wish to avoid anything. I just want to do it the right way. My chances of owing taxes are slim to none, because I have so little income. I have never owed taxes in Canada, and so in all likelihood will not owe taxes in the States. But it's threading the needle correctly, even with a situation that's as relatively simple as mine, that seems to be such a trial. Even when I go to the "experts," I get as many different interpretations on how to do things. This latest accountant has told me that as of February 2011, anyone with a TSFA or RESP must fill out this form and have it in by March 15. So I guess I will have to call her and find out where she got her info from.

Sorry, I should have typed as of February 2012.

Personally, I would treat the TSFA like a regular savings account, but I see online that a number of tax advisors are saying that the IRS "may" consider them a form of foreign trust. Not really having all that great an understanding of them (and it may depend a bit on exactly what sort of investments you have in the TSFA) I guess you have to go with what your tax advisor tells you to do - unless you're willing to assert your own position on the issue and defend it yourself if and when the IRS questions it.
Cheers,
Bev

Thanks, Bev! I think she's playing it safe and going with a literal interpretation, so I'll play it safe, too. Now all I have to do is figure out the danged terminology, LOL!

My TFSA isn't very complicated; it's a tax-free savings account into which we've deposited money and accrued some interest. That's all. Dunno why it warrants all this special paperwork, but there 'tis. I won't have it for much longer, and so will be happy when I don't have to deal with this paperwork anymore.