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Gift Tax or Bonus?

My father recently sold his company. I don’t and haven’t worked for his company an any official position. However, as a thank you “bonus” he gave me $100,000 check from the company to myself. How would this be taxed? Would it be considered a gift? How would it affect my tax return? 

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Level 15

Gift Tax or Bonus?

This transaction sounds like a pure gift; property (including money) was given by the donor without the donor expecting to receive something of at least equal value in return. 

 

See https://www.irs.gov/businesses/small-businesses-self-employed/gift-tax

 

Donees (recipients of gifts) do not have to report gifts on their federal tax returns but if the gift exceeds the annual exclusion amount ($15,000), then a gift tax return (Form 709) generally is required to be filed by the donor (gift tax is typically not due, however).

 

See https://www.irs.gov/instructions/i709#idm140554828343488

 

 

You should probably watch out for some sort of tax reporting statement, such as a 1099-MISC, or inquire as to whether you will receive a tax reporting statement, because you would have no choice but to report the payment as income if you receive one.