Does the IRS question the person receiving gifts of cash?

Question

A person can give multiple 12k to anyone without being taxed but the question is does the IRS question the person receiving?
A lot of people around me are getting married and (so will i in the near future) so naturally i am wondering what the maximum amount a person can receive before the IRS comes to the picture. For example: It doesnt make sense that a person can receive 100k from many people without having to report it to the IRS. The IRS website mentions the amount a person can give as a gift but nothing about the person receiving it.

Answer 1

There is no limit to the amount of gifts you can receive. It could be billions and you wouldn't owe a dime in taxes on it.

There is no need for the recipient of a gift to report it to anyone, as long as the gift came from within the US. If it came from a foreign donor, a Form 3520 return MAY need to be filed but no tax is due on the gift.

Answer 2

If you deposit a large amount of money into an account at one time, there is a notification process for the banks. However, gifts are taxed only to the giftor, not the giftee. Gifting is often used by the very wealthy to start moving wealth to family members in an effort to avoid estate tax. If the giftor gives more than the annual allowance person, then their gift tax exclusion amount gets reduced. For a gift of cash, you should be fine. Just keep documentation.

Answer 3

There is no limit on the total amount of cash that you can receive if the amount from each individual is below the limit on what they can give. However, if the gifts are really cash (meaning the green things that say "Federal Reserve Note", as opposed to checks), then you have to either make many separate trips to the bank or complete a special Treasury Department form. This is mainly to document that it is not drug money.

Answer 4

Although you may be questioned by the IRS if you receive a large amount of seperate 12K gifts, just document where they came from and be happy about it! It is very common for both mother and father to give their kids a 12K gift. That's 24K right! If grandpa and grandma do the same thing, then GREAT again and thats 48K.

Good luck in your quest.

Answer 5

Interesting answers.

But gifts aren't always gifts.

If you receive a "gift" from your employer, it's a salary, not a gift.

If you receive a "gift" from the company you partly own, you're making a draw or receiving a dividend.

If there is some understanding that you will pay this "gift" back in any way, even for services, you could find it termed a loan, and someone will be imputed some interest regardless of any arrangement you've made.

Answer 6

The person receiving the gift isn't taxed no matter how much they receive. You could receive $10 million dollars from someone, and you wouldn't pay any tax on the gift, although at that amount they would owe tax on the gift.