i have a relative who has been unemployed for several years, and this combined with other things led him to attempt suicide a couple of months ago, when he could no longer pay the rent.
he finally got help (medication), and a friend took him in, but she is a schoolteacher like me, and no better off financially.
i have been sending money to this relative to help out as much as i can. he is another state, so i can't claim him as a dependent, and i don't want to, but can i deduct the amounts i send him on next year's taxes? and if i can, what evidence do i need- would the checks be sufficient?
2007-04-17 05:15:58 · 4 answers · asked by leilani 6 in Business & Finance ➔ Taxes ➔ United States
the amount i plan to send this year (which is really all i can afford) will not be in excess of $2000.
2007-04-17 05:28:23 · update #1
There are a couple of things going on here.
First off, depending upon the amount of the "gifts" you may actually owe Gift Taxes for the money given to them. You get a $12,000 annual exclusion per recipient but if you gave more than that you'll need to file a Gift Tax return and pay any Gift Tax due.
However, it may be possible to consider this money as support provided and possibly claim the relative as a dependent. Certain close relatives do NOT need to live in your household to be dependents and as long as you provided more than half of their support AND they have less than $3,300 in gross income. Going this route would bypass the Gift Tax question entirely though you probably have a strong case to consider this as support even if you don't or can't claim him as a dependent.
There is no deduction that you can claim for the money you provided for their support. Your only possible tax break would be from claiming them as a dependent if you meet the criteria.
2007-04-17 05:23:05 · answer #1 · answered by Bostonian In MO 7 · 0⤊ 0⤋
Generally a gift is a gift. Since he is not a recognized charity, gifts to him are not tax deductable, but it is good that you are helping him out during this rough time he is going though. The world needs more people like you.
2007-04-17 12:26:32 · answer #2 · answered by cookienjanelle 3 · 0⤊ 0⤋
No, the money you send is a gift, and can't be taken as a charitable deduction or deducted any other way.
2007-04-17 13:29:35 · answer #3 · answered by Judy 7 · 0⤊ 0⤋
$2000 is not deductible for you and he doesn't have to declare it as income either.
Best wishes.
2007-04-17 17:35:38 · answer #4 · answered by JQT 6 · 0⤊ 0⤋