@chipmario wrote:
I have a similar issue. I'm on a non-immigrant visa (F1) in the US, and I need to send around $50000 to my parents, who live overseas, to support them financially for buying a house in their country. My parents supported me financially for my education in the US. I have two questions:
1. Is this payment of $50000 considered as a gift?
2. If so, do I have to pay gift tax or submit form 709?
Of course it's a gift. It wouldn't be considered a loan repayment by the IRS unless the loan was fully documented and you were paying your parents interest, and this could create tax issues for them.
As a student on an F-1 Visa, you are considered a non-resident alien for tax purposes (not a US person) and you file a 1040-NR (non-resident) if you have taxable income. Because you are a non-US person, you are not required to file form 709, this is only required of US citizens and US residents.
However, there are a few cases where you might be a US resident for tax purposes (such as, you made the election to file as a resident on a joint tax return with a US resident spouse, or you have been in the US longer than 5 years). In those cases, you would need to file form 709. Gift tax is not actually owed unless your lifetime gifts are more than $11 million.
