Is this a US tax question? Genreally, in the US, one can
give up to $12,000 away gift tax free each year. In
addition, one can generally give up to $1 million away gift
tax free during their lifetime. Thus, if you mum hasn't
used up her $1 million lifetime exemption, she should be
able to give you $100K outright w/o any tax consequences.
Also, you should be able to do the same (either using your
annual or your lifetime exclusion amounts). Of course,
there are some different rules if the gifts involve
foreigners. There are a number of other factors you should
consider in setting up a gifting program. Your tax advisor
should be able to address these issues for you.

Gary Brolis
http://www.MechanicsofMoney.com
http://www.MechanicsofMoney.com/blog.php

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Mark wrote:

- quote -

She can gift it to you outright and file to use part of her
unified credit. i.e. part of her estate's credit against the
estate tax upon death.

But if this is avoid nursing home costs using up her money,
be aware of the look-back period. Assets given away within X
number of months are deemed to have been transfered for that
purpose and aren't a completed gift.

JOE

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Mark wrote:

- quote -

Mark your mum may want to check with a financial planner.
To me it would be simpler for her to put the money in a bank
CD, get the interests paid to her, and leave you the money
in a will.

What's with the 7 years?

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"Mark" <markalroberts[at]gmail.com> wrote:

- quote -

Is this a loan? What's the purpose of this transaction?

- quote -

I don't know what a "gift with reservation of benefit" is.
If you are asking whether the amount of the gift for tax
purposes will be reduced by what you give your mother back,
the answer is that it depends. If you create the proper
paperwork so that this is a loan, to the extent the loan is
repaid it reduces the amount of principal, thus reduces the
amount of the gift.

Or you could put the money into a trust for your mother.
You would be the trustee, and the beneficiary when she dies.
To the extent you take money out to pay your mother, it
would reduce the eventual gift.

Bf you don't put this transaction properly, what you pay
your mother will probably be considered independent of her
payment to you, and will not reduce the amount of her gift
to you.

Stu

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My mum has $100,000 she wants to give me. I want to pay her a
certain amount each month out of my salary.

If, after 7 years, she dies, will the gift be seen as a "gift
with reservation of benefit", owing to the money I have given
her?

Many thanks.
Mark.

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >