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The gift is not taxable income for a recipient. You do not need to include it into your income. There is no any limitation for the value of the gift. Please see for reference IRS publication 525 page 30 - http://www.irs.gov/pub/irs-pdf/p525.pdf
The donor - if he/she is an US person - would be required to file gift tax return if the gift is more than $12,000 per person per year (for 2007). There will not be any gift taxes unless lifetime limit of $1,000,000 is reached. In your situation the donor would have to pay gift taxes. There is an unlimited gift tax exclusion available to pay someone's medical or educational expenses.
You may see more information on the gift tax form and instructions:
Sorry for confusion. Let's use an example for clarification. If you pay someone's expenses - that would be a gift to that person. It doesn't matter if you related to the person or not unless you are married - gift between spouses are not taxable gifts if both are US persons.
As your gift amount would be above $12,000 (for 2008) - you are required to file a gift tax return and all amount above $12,000 - is taxable gift. If the car cost is $$18,000, your taxable gift is $18,000-$12,000=$6,000.
Each person may exclude from gift taxes during lifetime $1,000,000. If you never made taxable gifts - you may exclude these $6,000, and your lifetime limit after that will be $1,000,000 - $6,000 = $994,000;
If you during your lifetime already made taxable gifts total above $1,000,000 - you would need to pay taxes on that $6000 (from the example above).
You do not need to accept twice unless that was you intend.
I do not want to overcharge you. You may request a refund by contacting the customer service or email customer service at [email protected].