Tax consequences of getting cash gift from parents

[Widescreen]

Any of you tax people know what the tax implications are for the recipient of a cash gift from parents? Are there limits of some kind?

[TopDaugIn2000]

I don't know, but I've heard of something like that before.

To me, that money has ALREADY been taxed, so **** the IRS. **** off dip****

[Mjcpr]

I believe there are limits but I think any tax burden would be the responsibility of the giver, your parents.

Sweet deal, eh? :D

[soonerbrat]

I think you can receive up to $10,000 as a gift without being taxed.

[Newbomb Turk]

cash...what cash?

[Mjcpr]

If you give someone money or property during your life, you may be subject to federal gift tax. The money and property you own when you die (your estate) may be subject to federal estate tax. The purpose of this web page is to give you a general understanding of when these taxes apply and when they do not. It explains how much money or property you can give away during your lifetime or leave to your heirs at your death before any tax will be owed.
Most gifts are not subject to the gift tax and most estates are not subject to the estate tax. (Only about 2% of all estates are subject to the estate tax).
Generally, you do not need to file a gift tax return unless you give someone, other than your spouse, money or property worth more than the annual exclusion ($11,000 in 2002, 2003, 2004 and 2005; $12,000 beginning in 2006) for that year. Although a return may be required, no actual gift tax will become payable until the cumulative lifetime taxable gifts exceed the applicable exclusion amount. The donor is primarily responsible for the payment of the Gift Tax.

http://www.irs.gov/businesses/small/article/0,,id=98968,00.html

[JohnnyMack]

And you'd report this why?

[mikeelikee]

My understanding is the same as soonerbrat. Up to $10,000 (per year) is exempt.

[GottaHavePride]

My understanding is the same as soonerbrat. Up to $10,000 (per year) is exempt.

Dude. Mjcpr just posted a link to the IRS stating that it's 12,000 starting in 2006.

[Viking Kitten]

You really, really wanna check with an accountant on this one, or maybe Czar and Froz might have some good advice for you. For example, I believe the $10K rule previously mentioned has increased over the last few years, and I am also pretty sure the $10K is from person to person, so with more that one parent being the "giver" and if you have a spouse and/or dependants, you can actually recieve a lot more without tax complications if you set the whole thing up properly.

A lot of people use this method to start transferring wealth before they die to avoid inheritance tax.

Seriously, seek professional advice on this question.

[Mjcpr]

So the answer is $10k then?

[Fugue]

So the answer is $10k then?

no, you just said it was 12k.

nice short term memory. :texan:

[JohnnyMack]

no, you just said it was 12k.

nice short term memory. :texan:

He drinks a lot. Be patient.

[Viking Kitten]

I would also advise you never to listen to Pat, unless you are having some gynecological problems or something.

[colleyvillesooner]

Prolly like 50 bucks.

[85Sooner]

I think you can receive up to $10,000 as a gift without being taxed.


i AGREE.

[Grimey]

You really, really wanna check with an accountant on this one, or maybe Czar and Froz might have some good advice for you. For example, I believe the $10K rule previously mentioned has increased over the last few years, and I am also pretty sure the $10K is from person to person, so with more that one parent being the "giver" and if you have a spouse and/or dependants, you can actually recieve a lot more without tax complications if you set the whole thing up properly.

A lot of people use this method to start transferring wealth before they die to avoid inheritance tax.

Seriously, seek professional advice on this question.

Yep. You can have your Mom give you $12k, your dad give you $12k, then your mom give your spouse $12k, and your dad give your spouse $12k.

Total to your family for you non-math majors: $48K.

[Widescreen]

So I'm asking this from the recipient perspective. I know that the parent can give $10000-$12000 with no tax consequence but I was wanting to know if I get like $8000 from a parent, what are my tax consequences for that? I think it sounds like there is no consequence for the recipient either. If so, that's sweet.

[JohnnyMack]

Yes my friend, you are in fact going to Sizzler.

[Vaevictis]

So I'm asking this from the recipient perspective. I know that the parent can give $10000-$12000 with no tax consequence but I was wanting to know if I get like $8000 from a parent, what are my tax consequences for that? I think it sounds like there is no consequence for the recipient either. If so, that's sweet.

As previously quoted by Mjcpr:


The donor is primarily responsible for the payment of the Gift Tax.

I expect that means that if there are no tax consequence for them then necessarily there is no tax consequence for you.

[Widescreen]

Yes my friend, you are in fact going to Sizzler.
YeeHaw!!!!!

[SleestakSooner]

Vegas in a hot tub baby!

http://www.snowblahg.com/wordpress/wp-content/uploads/2006/09/hot-tub.jpg

[Mjcpr]

no, you just said it was 12k.

nice short term memory. :texan:

Nice sarcasm catcher. :texan:


:D

[Hamhock]

is there still a tax question here?