I want to transfer $20,000 to a friend from my US bank account to His. Will there be any tax implications for him? Is there a limit to how much can I transfer?

Forum|Forum|7 years ago
June 5, 2019
5 replies
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Carl

Level 11

You'll have to ask your bank or whatever service (western union maybe?) if they have a limit. Now for tax purposes, if this is a loan that you are NOT charging interest on, you have nothing to report, since it will be *presumably* paid back.
However, if you are *giving* it to the friend as a gift that never has to be paid back, then any gifts of more than $14K given in a tax year require the giver of said gift to file a gift tax return with the IRS. There will be no taxes paid on it. But the filing is still required. TurboTax does not deal with the gift tax return at all. You'll have to see a CPA for that.
For the recipient of a gift, they report absolutely nothing to anybody. Any reporting requirements are on the giver of the gift - not the recipient.

SweetieJean

Alumni - Champ

Just be aware of potential money laundering concerns.

SweetieJean

Alumni - Champ

What is the reason for the transfer?

SweetieJean

Alumni - Champ

and are either of you foreign nationals?

Opus 17

Level 15

Gifts are not taxable to the giver or the recipient.

If the transfer is a loan, you don't owe tax now but will owe tax on the interest if you are repaid with interest.

All transactions over $10,000 are automatically reported to the IRS. No tax may be owed, but if you are doing something you shouldn't be (such as moving proceeds from illegal activity, or disguising a payment for work performed as a gift), realize there will be a record of the transaction that could be investigated if there was cause to do so.