Foreign gift of mortgage
Sister and Brother in law of client live in the Cayman Islands. I believe they have dual citizenship. They give an interest only mortgage with a balloon payment after three years of $700K. to a neighbor who purchased land from them in the Caymans. Sister and BIL set it up so that the interest and the subsequent balloon payment goes directly to my US client. I have so many questions I don't know where to begin. First off, does it matter if the BIL and sister are foreign nationals, have dual citizenship or are US citizens? Secondly, when do I have to prepare Forms 3520 and or Forms 8938? Thank you to anyone who can point me..