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You will have no tax liability for the gift you received, however your grandfather will have to file a Gift Tax Return because the gift exceeds the 2007 limit of $12,000. If your grandmother is alive that limit would go to $24,000. In either case the limit is exceeded and the return must be file. Whether the giver has to pay a tax is determined by the Unified Credit per gift per person of $345,800. Here is a link to IRS Pub 950 that covers Gift Tax:
Here is another link to an overview of the subject:
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