My wife and I file jointly and received a $20,000 Gift from her parents after her father sold his business. Where do I add this to my return or do I?

[macuser_22 · Accepted solution]

Gifts are not reportable at all for the receiver of the gift.   The giver might be required to file a gift tax return of over $14,000 to any one individual.  The father could give $14,000 to you, $14,000 to your spouse without triggering the gift tax return, but that is their concern, not yours.   You have nothing to report.

[SweetieJean]

However, you can record it as nontaxable income in the Sales tax deduction section if you itemize.

[joeyreys]

What if a father and mother are wanting to give a financial gift to their son and daughter-in-law? Could the father and mother each give $14,000 to their son and then each give $14,000 to their daughter-in-law, resulting in the son and daughter-in-law receiving a total of $56,000, without having to pay taxes as givers?

[VolvoGirl]

Yes that's how it works.

[macuser_22]

And even if it exceeded the limits, there would be no tax to pay - only the requirement to file a gift tax return which would lower their lifetime $5.3 million exclusion by that amount.