I received a financial gift from my brother where do I enter that

[annemaried3]

it was a large gift and my brother paid the taxes

[Lilly Peck · Accepted solution]

A monetary gift is not taxable to the recipient.

The person who makes the gift files the gift tax return, if necessary, and pays any tax.

If someone gives you more than the annual gift tax exclusion amount ($14,000 in 2015 and 2016), the giver must file a gift tax return. That still doesn’t mean they owe gift tax.

For example, say someone gives you $20,000 in one year, and you and the giver are both single. The giver must file a gift tax return, showing an excess gift of $6,000 ($20,000 – $14,000 exclusion = $6,000).

Each year, the amount a person gives other people over the annual exclusion accumulates until it reaches the lifetime gift tax exclusion.

Currently, a taxpayer does not pay gift tax until they have given away over $5.43 million in their lifetime (2015).

Does the gift recipient ever have to pay gift tax?

If the donor does not pay the tax, the IRS may collect it from you.

[Stanly]

My sister and I wish to give a monetary give to a niece and nephew.  May I give her the maximum amount of 15,000 and my sister also give the same person the maximum  amount to the same person?

My understanding is that the recipient does not have to pay taxes, and the givers do not either so long as the amount is 15 K or less.  I also understand that it is not necessary to file an IRS form on this kind of gift.

Am I correct

[xmasbaby0]

Yes, you are correct.   You and your sister can each give a gift to the same person if you choose to.  The gift is not taxable to the person who receives the gift.  If your gift is less than the yearly limit to one person you do not need to report it or enter it on a Form 709.

Money that you receive as a gift is not taxable income to you, and you do not need to report it on your income tax return.  Money that you gave as a gift to someone else is not deductible for your taxes.

Turbo Tax does not support the gift tax form 709, but here is a link:

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

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

https://www.forbes.com/sites/ashleaebeling/2017/10/19/irs-announces-2018-estate-and-gift-tax-limits-...

[VolvoGirl]

Yes that is right.  Anyone can give another person 15,000.  So like if you are married you can give someone 15,000 and you spouse can give 15,000.  And they are married you can give each spouse 15,000.  So a married couple can give another couple 60,000.

[dguerr]

If my brother made a financial gift to me and didn’t pay any tax on it, solely because he has not reached the maximum of gifts, do I then have to pay any tax on the gift? I read that if he doesn’t pay the tax IRS can bill me for it. 

[DoninGA]

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@dguerr wrote:

If my brother made a financial gift to me and didn’t pay any tax on it, solely because he has not reached the maximum of gifts, do I then have to pay any tax on the gift? I read that if he doesn’t pay the tax IRS can bill me for it. 

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Gifts received from an individual are not reported on a tax return, regardless of the amount received.

Gifts given to an individual are not reported on a tax return.  If the gift given is over $15,000 in 2021 then the giver of the gift must report the gift on IRS Form 709.  There will not be any taxes owed on the gift if the total of all gifts ever given were less than $11.7 million.

[SweetieJean]

However, you can still record it as nontaxable income for purposes of calculating the itemized Sales Tax deduction.