How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Steve -- a.k.a. Oreport Your Own Ques...
Steve -- a.k.a. Oreport
Steve -- a.k.a. Oreport, Internet Information Researcher
Category: Tax
Satisfied Customers: 1079
Experience:  Links to relevant I.R.S. materials provided with each US Federal Tax answer 1,000 Site-wide Accepts.
Type Your Tax Question Here...
Steve -- a.k.a. Oreport is online now
A new question is answered every 9 seconds
This answer was rated:

Do we have to pay taxes on donation we recieved?

Do we have to pay... Show More
Do we have to pay taxes on donation we recieved if the proceed were later given as a gift?

In Jan 04 my wife's father suffered a heart attack. His five kids (My wife is second of five) set up a bank account the their names (the five kids) to accept donations for the medical bills of their father. They rased about $7,000.
This money was gifted to the father to help pay medical bills.

Now I'm fairly sure from reading FORM 709, the father does not have to pay taxes, but what about the five kids? Do they have to report this as taxable income?

?Optional Information: tucson, ArizonaAlready Tried: IRS 709
Show Less
Ask Your Own Tax Question

With regard to the monetary donations received by your wife and her siblings under The United States Tax Codethese monies are considered gifts' -- and, are not treated as taxable income with respect to any of the recipients -- your wife and her siblings, or their father.

With respect to your wife and her siblings giving money to their father --
The United States Tax Code allows each individual to give $11,000 per year -- per person, to as many people as they wish -- without having to either pay a gift tax -- or file a report oneon the gifts given.

What is more,
each person also has a $1 million lifetime gift exclusion -- over and above the $11,000 annual per-recipient exclusion. Gift amounts in excess of the $11,000 annual per-recipient exclusion -- but under the $ 1 million $1 million lifetime gift exclusion must be reported -- but are not taxed.

You will find more information contained in IRS Publication 950.

Let me know if you need more input.

Good Luck!

Gifts are not taxable. They are specifically excluded from taxable income by the statute.Form 709 is filed by the donor - not by the donee - and only when the gift is above certain threshold.
In the US - gift - is not taxable income for the recipient and you do not need to report it on the tax return.There is no any amount limit.It does t matter how the gift is transferred - as long as that is a gift - there is NO income tax liability.Please see for reference IRS publication 525 - and inheritances. In most cases, property you receive as a gift, bequest, or inheritance is not included in your income. However, if property you receive this way later produces income such as interest, dividends, or rents, that income is taxable to you....Another issue with gift tax...Regarding your situation - if the donor (gifter) is an US person - the gift is reported on the gift tax return. The gift below $14,000 is not taxable gift but when the gift is above that threshold - it is reported on the gift tax return - form 709.Regardless - there will NOT be any gift tax liability as long as the lifetime limit is reached - that limit is $5,430,000 for 2015.Any questions?