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Hi all,

I may be receiving a cash gift ($50-$100K) from a sibling, and wonder what the tax implications of this would be?

I plan to consult a professional, but value any feedback from Fools.

Thanks,

Sjec
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I may be receiving a cash gift ($50-$100K) from a sibling, and wonder what the tax implications of this would be?

I plan to consult a professional, but value any feedback from Fools.



You, as the recipient of the gift, would owe no tax. Gifts are taxable to the donor, not the recipient.

Your sibling needs to file a gift tax return if he or she gives you more than $11,000 in one calendar year.

ab
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angelbuggy: "You, as the recipient of the gift, would owe no tax. Gifts are taxable to the donor, not the recipient.

Your sibling needs to file a gift tax return if he or she gives you more than $11,000 in one calendar year."


I concur.

OTOH, if the original poster is married, the sibling could double the tax-free gift amount by gifting to the original poster and spouse.

If the gifting sibling is married, the tax-free gift could also be double by the sibling and spouse gift splitting and giving to the original poster.

If both the original poster and the gifting sibling are married, the tax-free gift amount could be quadrupled by using both techniques.

Regards, JAFO


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OTOH, if the original poster is married, the sibling could double the tax-free gift amount by gifting to the original poster and spouse.

If the gifting sibling is married, the tax-free gift could also be double by the sibling and spouse gift splitting and giving to the original poster.

If both the original poster and the gifting sibling are married, the tax-free gift amount could be quadrupled by using both techniques.

Regards, JAFO


Right, but he said the gift was going to be in the 50-100K range, so even if both parties are married, a gift tax return would need to be filed. Main point is the poster doesn't have any tax consequences to himself.

But you're right. Since I'm single I tend to think "single" about these things. :o)

ab
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Hey thanks everyone!

I understand now that the giver would pay the gift tax, not the recipient.

But (I feel stupid asking this) of course I would pay income tax myself on this amount, would I not?

Thanks again for your speedy responses,

Sjec
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angelbuggy: "Right, but he said the gift was going to be in the 50-100K range, so even if both parties are married, a gift tax return would need to be filed."

44k is in the ballpark of 50k. In any event, either (or both) techniques would save some of the lifetime exemption of the gifting sibling.

"Main point is the poster doesn't have any tax consequences to himself."

Agreed.

"But you're right. Since I'm single I tend to think "single" about these things. :o)"

Thanks. We all have our perspective. I was writing for both the original poster and the board.

Regards, JAFO


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But (I feel stupid asking this) of course I would pay income tax myself on this amount, would I not?

No. A gift is not income. If you earn interest on the money or invest it in something that creates income, then you pay income tax.

Ira

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Ira,

Thank you for clarifying that for me!

Fool on,

Sjec

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