Gift of monet

[Dparry]

I want to give my daughter and son-in- law a 27000.00 gift of money to pay off their car.  Would they have to claim that money on their taxes?

[xmasbaby0 · Accepted solution]

Gifts given to family members, friends or other individuals are not deductible.   Gifts received are not taxable to the person who received the gift, and are not entered on a tax return.

If your gift exceeds the yearly limit ($19,000 per individual)  imposed by the gift tax rules, then you will need to complete a Form 709 gift tax form and send it to the IRS, although it is very unlikely that you will owe any tax.

TurboTax does not support Form 709.  It is not an income tax form and would not be included as part of an income tax return.

Here is a link to the form:

https://www.irs.gov/pub/irs-pdf/f709.pdf

https://turbotax.intuit.com/tax-tips/estates/the-gift-tax-made-simple/L5tGWVC8N

Here's a link for Form 709 preparation software:

 https://www.puritas-springs.com/product-category/federal

Here are some useful videos on the Form:

https://www.youtube.com/watch?v=a5wJow5h-No

https://www.youtube.com/watch?v=5Z_28sVOrTY

[rjs · Accepted solution]

You can avoid having to file a Form 709 gift tax return by making two separate gifts that add up to $27,000. Make one gift of $19,000 or less to your daughter and a separate gift of $19,000 or less to your son-in-law.

They do not have to report the gifts on their tax return as long as it's a true gift that you do not expect them to repay.