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Started By
Message
Gift tax question
Posted on 8/31/16 at 6:42 pm
Posted on 8/31/16 at 6:42 pm
My house recently flooded and my grandmother has graciously offered to help us with the rebuild since I had no flood insurance. What's the best way to transfer 50k from her to me without being hammered in taxes?
6
Posted on 8/31/16 at 6:53 pm to Glock17
The giver pays the tax, not the recipient. Mawmaw can give you and your wife each $14K a year without incurring a tax penalty. So she could give y'all $14k s year, and then another $14k ea on Jan 1st with no tax consequences.
Posted on 8/31/16 at 7:07 pm to hungryone
quote:
giver pays the tax, not the recipient. Mawmaw can give you and your wife each $14K a year without incurring a tax penalty. So she could give y'all $14k s year, and then another $14k ea on Jan 1st with no tax consequences.
That's what I thought... What if she give it to 14k each to me, my wife, and each of my parents? Could my parents in turn gift us each the 14k?
Posted on 8/31/16 at 7:13 pm to Glock17
She could also pay the contractor directly.
Posted on 8/31/16 at 8:00 pm to Glock17
There should be no tax consequences unless your grandmother has made over $5.45 million in gifts previously. There is a lifetime exemption from estate and gift taxes of $5.45 million. She should be able to apply some of that exemption to any gift she gives you that exceeds her ability to use the $14,000 per recipient annual exclusion gift provisions. If you are married and have 2 children, then she could give your family up to $56,000 in gifts excluded from the gift tax, and she could use the lifetime exemption for any gift(s) in excess of the $56,000.
Posted on 8/31/16 at 8:06 pm to Poodlebrain
quote:
ere should be no tax consequences unless your grandmother has made over $5.45 million in gifts previously. There is a lifetime exemption from estate and gift taxes of $5.45 million. She should be able to apply some of that exemption to any gift she gives you that exceeds her ability to use the $14,000 per recipient annual exclusion gift provisions. If you are married and have 2 children, then she could give your family up to $56,000 in gifts excluded from the gift tax, and she could use the lifetime exemption for any gift(s) in excess of the $56,000.
Good info.. Thanks! I'm sure she's made nowhere close to $5.45 million in donations.
Posted on 8/31/16 at 8:34 pm to Glock17
The $5.45 also applies do her estate. So taxes will come if she has that much in her estate when she dies (the $50,000 goes against that $5.45 mil)
Posted on 8/31/16 at 8:46 pm to AndyJ
quote:
The $5.45 also applies do her estate. So taxes will come if she has that much in her estate when she dies (the $50,000 goes against that $5.45 mil)
It's $10.9 if she's married, or her spouse is deceased and left his assets to her.
Posted on 8/31/16 at 9:09 pm to AndyJ
quote:
the $50,000 goes against that $5.45 mil
Not if she used her yearly exclusions. Anyways, poodle wrote everything you need to know.
Posted on 9/1/16 at 12:05 pm to Glock17
If your grandfather is still alive, then he can also give the $14k as a gift untaxable.
Another option would be to gift you the $14k, and give you a loan for the rest w/ a minimal interest rate. She then can offset the payments with another $14k gift each year. Married doubles the annual amounts, and each kid is also eligible for the $14k annually.
Another option would be to gift you the $14k, and give you a loan for the rest w/ a minimal interest rate. She then can offset the payments with another $14k gift each year. Married doubles the annual amounts, and each kid is also eligible for the $14k annually.
Posted on 9/1/16 at 5:23 pm to Weekend Warrior79
Follow up question:
Can the check just be made out to me as a gift to my family of 4 or would it need to be 4 individual checks??
Can the check just be made out to me as a gift to my family of 4 or would it need to be 4 individual checks??
Posted on 9/2/16 at 9:27 am to Glock17
4 checks would be best, but a single check is okay if it indicates the check is gifts for 4 people.
Posted on 9/2/16 at 9:33 am to Glock17
You have an awesome granny. But I'm sure you already knew that.
Posted on 9/4/16 at 7:30 am to Glock17
have your grandmother give you $100 bills
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