Seth Breidbart wrote:
- quote -

OK, we're running in to LEGAL questions, rather than
tax questions, so I believe I should withdraw my
statement.

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Arthur L. Rubin <ronnirubin[at]sprintmail.com> wrote:

- quote -

Why? If the settlement agreement doesn't specify (because
the payor presumably doesn't care), don't the recipients get
to decide how it's split? Presumably, the daughter signed
off on the settlement agreement; that indicates she ought to
be getting something as part of it.

Seth

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anthrochick[at]hotmail.com (J.L.) wrote in news:107sdj7g02gsua9

- quote -

Would paying a CPA for a couple of hours of advice really
dig onto that One-Hundred Thousand Dollars ($100,000.00) a
lot in their area?

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J.L. wrote:
- quote -

OK

- quote -

Not OK. If the money is not taxable, it must be for
a physical injury. "Loss" has nothing to do with it.

As for the daughter being a plaintiff: Does the
settlement agreement specify who the money is for?
If so, who the check is written to is irrelevant.

If not, the $20K is a gift. Mother would have to
report it on a gift tax return, togehter with
whatever she gave daughter during the year.

$11K is tax free, and the remainder is (essentially)
added back in for the purpose of futher gift
and estate tax returns. There is no consequence
unless total taxable gifts (to all people)
exceed $1M, or gifts plus estate exceed
whatever the current number is in the
year of mother's death. It's now $1.5M.

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Hello, I have a friend whose family just got awarded a
hundred thousand dollars in a malpractice settlement. My
friend, who is the daughter, said that her mom wanted to
give her a portion of the money (about 20K). Does the
daughter have to pay taxes on this? This is what I know:

1. The money is not going through probate.
2. The money is not taxable because it is considered a loss
(however, does that mean it is not taxable for the
daughter too? They were both plaintiffs in the case).
3. The check is being written out to the daughter's mother.
4. The daughter is a 28-year-old student.

Thanks.

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