My uncle manages my dad's pension money in the UK and wires me the money for his expenses (my dad is severly disabled). I deposit this money in my mom's account in Costa Rica (that's where they retired) and since she takes care of my dad. The reason for this is everybody involved is terrible with wire transfers and any change causes major trauma, lost money and a few months delay to get the money straight. I always end up having to pay my parents' expenses for a while when this happens (don't always get paid back), so I just set it up so I can handle it to make it easier. My question is, is this money considered taxable income for me since I'm in the US?
2007-05-23 07:50:26 · 5 answers · asked by Ana G 1 in Business & Finance ➔ Taxes ➔ United States
No, it's not taxable income to you, but with all the transferring around, keep good records in case it's ever questioned.
2007-05-23 08:03:38 · answer #1 · answered by Judy 7 · 1⤊ 0⤋
No, if its under 10,000 dollars US its not income. Besides, how would the IRS know if you got money from someone? If I gave you 100 bucks for mowing my lawn, there is NO way they would know about it because I wouldnt have filed a W2 or any other tax paperwork. Your uncle could also mail you a cheque..(that way it doesnt cost you money to transfer funds, which can be several percent of the entire amount) if sent western union. You should either open an account with your uncles bank and have the money transferred for free, or have him send you a cheque.
2007-05-23 07:59:50 · answer #2 · answered by Anonymous · 0⤊ 0⤋
I don't know for sure. If it is less than 10K a year, I would say it is not taxable, because you can receive up to 10K as a gift from anyone and not be taxable. If it is more than 10K, it is a possibility. I would think you would in some way have to prove that it is not income for you and you do not receive any benefit from the money.
2007-05-23 08:00:08 · answer #3 · answered by Barry 3 · 0⤊ 0⤋
it is only taxable income for you if you gain wealth by the transfer. if you are just holding the money for your parents, but it really belongs to your parents, then it is not YOUR income because the money is not ultimately yours. however, if you gain any money from the transfer, whatever you do gain is income.
2007-05-23 08:05:36 · answer #4 · answered by Helen J 1 · 0⤊ 0⤋
I think it would be considered a "gift"- or it could be...
2007-05-23 07:58:40 · answer #5 · answered by kermit 6 · 0⤊ 0⤋