Harlan Lunsford <hlunsfordnoway[at]bellsouth.net> wrote
- quote -

Depends. If each spouse is the owner of the gift he or she
makes, no return is necessary.

But if some or all of the gift would otherwise be taxable,
the gifts can be considered split under IRC section 2513.
In that case, the husband and wife must both consent to the
split gift, and that consent must be shown by both signing a
gift tax return under IRS regulations promulgated under that
statute.

Stu

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Paul A. Thomas wrote:
- quote -

As best I remember, Paul, a gift tax return is called for
when such a "joint" gift is given. IOW, no gift tax return
if one spouse gives to the two of them.

No?

Cheer$,
Harlan LUnsford, EA across the river.

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vivian.li[at]oracle.com (Vivian) writes:

- quote -

If you're expected to pay it back, with or without
interest (and especially if with interest!) it's
not a gift, plain and simple.

For it to be a gift, there can be no strings attached,
written or unwritten, formal or informal.

- quote -

Intra-family loans are subject to imputed
minimum interest rates.

--
Rich Carreiro rlcarr[at]animato.arlington.ma.us

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vivian_z_li[at]yahoo.com (vivian) wrote:

- quote -

A gift to you (of any amount) is not taxable to you, nor
deductible by the giver. If the gift is over $44,000
($11,000 to each of you from each parent), they will have to
file a Gift Tax return, but generally owe no tax. If the
parents give split gifts, a form 709A needs to be filed.

Gifts cannot have "strings" attached. If you have to pay it
back, it is not a gift and telling the mortgage company that
it is would amount to fraud. Of course, you could always
gift small amounts back to your parents each month, but
there would be no legal imperative to do so (merely moral).

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vivian_z_li[at]yahoo.com (vivian) wrote:

- quote -

You don't pay taxes on it, no matter how generous a gift it
is: it's tax free to you. They may have to file a gift tax
return, but they may or may not owe any tax. They can give
you and your spouse up to $44,000 without any tax
consequences. Even if they give you more than that, it comes
out of their lifetime exclusion, and they don't pay any
current tax until that gets used up.

But if it's a gift with strings attached (such as you
agreeing to pay them back), it's not a gift; it could breach
your mortgage agreement, and it could be attacked by the IRS
as being a loan with below-market interest.

--
Chris Green

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vivian_z_li[at]yahoo.com (vivian) wrote:

- quote -

The first thing my clients ask me is will they have to pay
income tax on a gift received from their parents. The short
answer is that it is not income to the donee nor is it a
deduction for the donor.

Assuming the "we" means yourself and spouse your parents can
give each of you $11000 or $44000 total ($11000 from dad and
$11000 from mom to each of you) for 2003. If the amount of
the gift exceeds $44000 then it would be your parent's
responsibility to file a gift tax return. Under normal
circumstances there would not be any tax due, but your
parent's lifetime unified credit would be reduced.

Robert A Moore, EA

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"vivian" <vivian_z_li[at]yahoo.com> wrote:

- quote -

YOU don't usually have to pay any tax on a gift received,
the donor does. You don't say how much the gift is, just
that it exceeds the annual amount. However, the annual
amount is $11,000 per donor AND per recipient. This means
that your mom and dad can give you and your husband a
combined $44,000 before a gift tax return would be required.
At 20% this gets you a $220K house.

If what you are getting is more than $44K, you and your
parents should meet with the mortgage broker and discuss
"shared equity financing" as an option. This is pretty
common when parents are helping the kids buy a house. Mom
and Dad pony up the down payment and the kids take on the
note - everyone's names go on the title. There are details
to work out, but it is a viable option and can avoid the
gift issue since now mom and dad are INVESTORS in the
property.

Good luck,
Gene E. Utterback, EA

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"vivian" <vivian_z_li[at]yahoo.com> wrote:

- quote -

When you say "us", I assume you mean your husband and you.
Your parents can give you a total of $44,000 per year
without gift tax consequences. (Your parents can each give
your husband $11,000 and they can each give you $11,000.)
None of the money is income to you, so you have no income or
other tax consequences. If they give you more than that,
they will need to file a gift tax return. That affects
them, but not you.

Joel Berry, CPA
Sugar Land, Texas

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"vivian" <vivian_z_li[at]yahoo.com> wrote:

- quote -

Any money received as gifts is not taxable income to the
receiver of the gift. It may be taxable to the one doing the
giving.

Wayne Brasch, CPA, M. S. Taxation

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"vivian" <vivian_z_li[at]yahoo.com> wrote:

- quote -

First let me say that gift taxes are the responsibility of
the donor (Parents) not the donee (You). Secondly we are
talking about the amount in excess of $22,000. Your parents
would have two choices to pay the tax or reduce their
unified credit. With the ever increaseing unifified credit
this is probably the best bet. So, if you take it has a gift
taxes can ve avoided. Please let me know if you have any
further questons.

--
Glen Hughes, CPA
www.glenhughescpa.com
glen[at]glenhughescpa.com

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"vivian" <vivian_z_li[at]yahoo.com> wrote

- quote -

Gifts received are not income.

- quote -

You can receive as much as anyone wants to give you, and
it's always income tax free to you.

- quote -

The loan application is your major concern here. It needs
to be a gift to you so you can qualify without telling a lie
on the application.

Your parents may or may not need to file a gift tax return.
They each can gift $11,000 to you and your husband, making
the total family gift $44,000 from the two of them to the
two of you. Amounts above that would trigger a gift tax
return, although it's more than likely there wouldn't be any
tax actually paid.

--
Paul A. Thomas, CPA
Athens, Georgia
taxman[at]negia.net

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"vivian" <vivian_z_li[at]yahoo.com> wrote:

- quote -

No

- quote -

Recipients of gifts do not pay tax on the gift.

--
David M. Woods, EA
Boston, MA 02109

Postings here are general information only and not to be
relied upon as advice.

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vivian_z_li[at]yahoo.com (vivian) writes:

- quote -

You really don't have any choice unless you want to submit
fraudulent loan papers. It's clearly not a gift if your
parents expect to be repaid. Yes, I know people submit
phony gift letters all the time, but that doesn't lessen the
reality of what's going on.

Phil Marti
Topeka, KS

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Hi, my parents are very nice to lend money to us so we can
put down 20% to our house.

The question I have is that, whether we should receive it as
a gift but pay back to them in deed by monthly payment.
Receiving it as a gift is what our mortgage broker prefers
so it won't be added as a loan to increase our debt ratio.

My question is that, if we receive it a s a gift, we would
have to pay tax on it, right? It is definitely larger than
the tax free amount you can receive per year?

Any suggestions , comments?

Vivian

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