Home › Forums › Financial Markets/Economics › Family cash gifts and taxes
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equalizer.
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May 15, 2009 at 3:23 PM #400502May 15, 2009 at 3:45 PM #399854
SDEngineer
Participant[quote=davelj][quote=sdduuuude]Can’t his mom gift $13K to 10 different people, then have each of those 10 other people gift to him or is it a $13K limit total for the gifter ?
[/quote]
It’s funny you mention that. I know a guy that’s part of a small group of wealthy folks, and the mothers and fathers each gift the maximum allowed to each of each family’s kids so that they, in effect, raise the maximum annual gift for each kid. There’s like 6 families involved with 15 kids, or something like that. So that each kid receives like $150K each year, instead of the miserly $12K (well, now $13K). I’m assuming it’s legal because the guy I know is pretty savvy about such things… but who knows…[/quote]
This is in fact completely legal. You are limited to 13K per gift recipient each year, but you can gift that amount to unlimited recipients, and there are no limitations as to how many gifts a given recipient can accept.
I think, though, that having all of those recipients then “regift” the money to a single recipient would trip some fraud flags in the IRS, since it’s a pretty transparent attempt to get around the tax-free gift limitation.
May 15, 2009 at 3:45 PM #400102Participant[quote=davelj][quote=sdduuuude]Can’t his mom gift $13K to 10 different people, then have each of those 10 other people gift to him or is it a $13K limit total for the gifter ?
[/quote]
It’s funny you mention that. I know a guy that’s part of a small group of wealthy folks, and the mothers and fathers each gift the maximum allowed to each of each family’s kids so that they, in effect, raise the maximum annual gift for each kid. There’s like 6 families involved with 15 kids, or something like that. So that each kid receives like $150K each year, instead of the miserly $12K (well, now $13K). I’m assuming it’s legal because the guy I know is pretty savvy about such things… but who knows…[/quote]
This is in fact completely legal. You are limited to 13K per gift recipient each year, but you can gift that amount to unlimited recipients, and there are no limitations as to how many gifts a given recipient can accept.
I think, though, that having all of those recipients then “regift” the money to a single recipient would trip some fraud flags in the IRS, since it’s a pretty transparent attempt to get around the tax-free gift limitation.
May 15, 2009 at 3:45 PM #400333Participant[quote=davelj][quote=sdduuuude]Can’t his mom gift $13K to 10 different people, then have each of those 10 other people gift to him or is it a $13K limit total for the gifter ?
[/quote]
It’s funny you mention that. I know a guy that’s part of a small group of wealthy folks, and the mothers and fathers each gift the maximum allowed to each of each family’s kids so that they, in effect, raise the maximum annual gift for each kid. There’s like 6 families involved with 15 kids, or something like that. So that each kid receives like $150K each year, instead of the miserly $12K (well, now $13K). I’m assuming it’s legal because the guy I know is pretty savvy about such things… but who knows…[/quote]
This is in fact completely legal. You are limited to 13K per gift recipient each year, but you can gift that amount to unlimited recipients, and there are no limitations as to how many gifts a given recipient can accept.
I think, though, that having all of those recipients then “regift” the money to a single recipient would trip some fraud flags in the IRS, since it’s a pretty transparent attempt to get around the tax-free gift limitation.
May 15, 2009 at 3:45 PM #400392Participant[quote=davelj][quote=sdduuuude]Can’t his mom gift $13K to 10 different people, then have each of those 10 other people gift to him or is it a $13K limit total for the gifter ?
[/quote]
It’s funny you mention that. I know a guy that’s part of a small group of wealthy folks, and the mothers and fathers each gift the maximum allowed to each of each family’s kids so that they, in effect, raise the maximum annual gift for each kid. There’s like 6 families involved with 15 kids, or something like that. So that each kid receives like $150K each year, instead of the miserly $12K (well, now $13K). I’m assuming it’s legal because the guy I know is pretty savvy about such things… but who knows…[/quote]
This is in fact completely legal. You are limited to 13K per gift recipient each year, but you can gift that amount to unlimited recipients, and there are no limitations as to how many gifts a given recipient can accept.
I think, though, that having all of those recipients then “regift” the money to a single recipient would trip some fraud flags in the IRS, since it’s a pretty transparent attempt to get around the tax-free gift limitation.
May 15, 2009 at 3:45 PM #400536Participant[quote=davelj][quote=sdduuuude]Can’t his mom gift $13K to 10 different people, then have each of those 10 other people gift to him or is it a $13K limit total for the gifter ?
[/quote]
It’s funny you mention that. I know a guy that’s part of a small group of wealthy folks, and the mothers and fathers each gift the maximum allowed to each of each family’s kids so that they, in effect, raise the maximum annual gift for each kid. There’s like 6 families involved with 15 kids, or something like that. So that each kid receives like $150K each year, instead of the miserly $12K (well, now $13K). I’m assuming it’s legal because the guy I know is pretty savvy about such things… but who knows…[/quote]
This is in fact completely legal. You are limited to 13K per gift recipient each year, but you can gift that amount to unlimited recipients, and there are no limitations as to how many gifts a given recipient can accept.
I think, though, that having all of those recipients then “regift” the money to a single recipient would trip some fraud flags in the IRS, since it’s a pretty transparent attempt to get around the tax-free gift limitation.
May 15, 2009 at 4:36 PM #399894patientrenter
Participant13k, unified credit, 13k limit applies per pairing of gift giver and gift receiver = true
May 15, 2009 at 4:36 PM #400142Participant13k, unified credit, 13k limit applies per pairing of gift giver and gift receiver = true
May 15, 2009 at 4:36 PM #400374Participant13k, unified credit, 13k limit applies per pairing of gift giver and gift receiver = true
May 15, 2009 at 4:36 PM #400433Participant13k, unified credit, 13k limit applies per pairing of gift giver and gift receiver = true
May 15, 2009 at 4:36 PM #400576Participant13k, unified credit, 13k limit applies per pairing of gift giver and gift receiver = true
May 15, 2009 at 6:57 PM #399253equalizer
ParticipantIRS gift tax rules is on link below. Over lifetime it appears you can give away $1,000,000 without paying gift tax.
http://www.irs.gov/publications/p950/ar02.html#d0e235
Friend needs to talk to a tax lawyer or read the
Tax Fraud & Evasion: Money Laundering, Asset Forfeiture, Sentencing [Vol. 2] book. Someone transfers large amount of cash (over $5,000) and the govt can take their money at will. See cnn link below. Indiana prosecutor was not criminally charged for personally keeping 25% of asset forfeitures!http://en.wikipedia.org/wiki/Asset_forfeiture
Texas police shake down drivers, steal their money under asset forfeiture laws.
May 15, 2009 at 6:57 PM #399505ParticipantIRS gift tax rules is on link below. Over lifetime it appears you can give away $1,000,000 without paying gift tax.
http://www.irs.gov/publications/p950/ar02.html#d0e235
Friend needs to talk to a tax lawyer or read the
Tax Fraud & Evasion: Money Laundering, Asset Forfeiture, Sentencing [Vol. 2] book. Someone transfers large amount of cash (over $5,000) and the govt can take their money at will. See cnn link below. Indiana prosecutor was not criminally charged for personally keeping 25% of asset forfeitures!http://en.wikipedia.org/wiki/Asset_forfeiture
Texas police shake down drivers, steal their money under asset forfeiture laws.
May 15, 2009 at 6:57 PM #399738ParticipantIRS gift tax rules is on link below. Over lifetime it appears you can give away $1,000,000 without paying gift tax.
http://www.irs.gov/publications/p950/ar02.html#d0e235
Friend needs to talk to a tax lawyer or read the
Tax Fraud & Evasion: Money Laundering, Asset Forfeiture, Sentencing [Vol. 2] book. Someone transfers large amount of cash (over $5,000) and the govt can take their money at will. See cnn link below. Indiana prosecutor was not criminally charged for personally keeping 25% of asset forfeitures!http://en.wikipedia.org/wiki/Asset_forfeiture
Texas police shake down drivers, steal their money under asset forfeiture laws.
May 15, 2009 at 6:57 PM #399797ParticipantIRS gift tax rules is on link below. Over lifetime it appears you can give away $1,000,000 without paying gift tax.
http://www.irs.gov/publications/p950/ar02.html#d0e235
Friend needs to talk to a tax lawyer or read the
Tax Fraud & Evasion: Money Laundering, Asset Forfeiture, Sentencing [Vol. 2] book. Someone transfers large amount of cash (over $5,000) and the govt can take their money at will. See cnn link below. Indiana prosecutor was not criminally charged for personally keeping 25% of asset forfeitures!http://en.wikipedia.org/wiki/Asset_forfeiture
Texas police shake down drivers, steal their money under asset forfeiture laws.
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