Message Font: Serif | Sans-Serif
 
No. of Recommendations: 0
There is no gift tax on gifts less than $10,000.

Gift taxes are always paid by the giver, not the recipient. And you can do stuff with reducing the eventual estate tax-free amount that I don't begin to understand, so I'll let someone else explain.

You won't owe the IRS anything on the gift. (Although you will obviously owe taxes on any interest you make on the money.)

BUT, the situation you describe is fraught with peril:
My great aunt is going into a nursing home and she has to divest herself of her cash assets and other goodies in order to get Medicaid/medicare(whoever) to pay for it.

There are recent legal changes to prevent people from giving away all of their money simply to qualify for Medicare. I recommend you don't do anything with the money just yet and get more financial advice first, in case some of it is needed to help finance your great aunt's medical care.

I'm sure you'll get a more complete answer shortly.

-Megan
Print the post  

Announcements

Disclaimer:
In accordance with IRS Circular 230, you cannot use the contents of any post on The Motley Fool's message boards to avoid tax-related penalties under the Internal Revenue Code or applicable state or local tax law provisions.
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.