how to gift , what to do?

Question

now my father wants to give gift-tax free gift of US12k each person to me and my husband, how should he go for it? can he simply issue a cheque of US24k to me or it has to be 2 separate cheque to each of us? there is no documentation or filling needed right?

Answer 1

He should definitely write two checks (one to each of you only) and you should photocopy them before you deposit them and then retain them with your tax records. the whole point of giving $12,000 (and no more) per year to each person is to avoid (or delay) payment of tax by the donor (ie your father). So long as it is truly a gift and is not disguised income, the recipients have no income tax obligations.

Answer 2

He should write seperate checks in order to be able to prove he did not give you more than the $12,000 allowable gift tax free. A gift is never income to you and you don't ever pay tax on receiving a gift.
Any tax would be levied on the person giving the gift and that would Only occur if they give any one person more than $12,000 in a calendar year.

Answer 3

If he writes a check bigger than $12,000, then he is suppose to file a gift tax form. (even though he will not owe any taxes on the gift)
Write two separate checks for $12,000, and the transaction is done. No one needs to file anything.

I am not a CPA, so verify. But I have taken an income tax course.

.

Answer 4

No, since one check for $24K would look like that much was given to you, and he'd need to file a gift tax form although he might not owe tax on it. If he gives each of you a check for $12K, then he doesn't need to even report it.

Answer 5

To do it legally, you should declare it as income on your own tax returns. And it doesn't matter how you get it. If you don't want to be legal, then forget about it...