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Ed Johnson
Ed Johnson, Tax Preparer
Category: Tax
Satisfied Customers: 10760
Experience:  GPHR Cert; U.S. Treasury Tax Advocacy Panel appointee
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This answer was rated:

We are Registered Domestic Partners in California and are terminating the relationship. My partner holds title to the house we share and is giving me $300,000 as my share. Will I have to pay regular taxes on this amount?

Dear Marta,

Under these circumstances, while you may have been sharing the property as partners, but your name did not appear on the title, you had no ownership.

So you did not sell your house, you were given a voluntary payment of 300,000 for the domestic partner home. This could be considered a gift; and you own no taxes.

however your donating partner, would have to file a gift tax return. In so doing, your donating partner would be able to take advantage of the gift tax exclusion; such that no tax is assessed as long as the total of such gifts does not exceed the 1 million dollar life time exclusion.

You do not add this to your adjusted gross income.

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Customer: replied 8 years ago.
I thot the amount a person could give as a gift was only $12,000 a year. Can she give me such a large amount as a gift?

A person may give as large a gift as they like. The 12,000 dollar gifting amount is the amount you can gift without filling out a gift tax return.

If the amount of a gift is in excess of 12,000 dollars, then it is reportable on a gift tax return. However.

As long as the gift does not exceed 1 million dollars for a life time of such gifts, there is no tax assessed. BUT, it reduces the amount of remaining life time gifts of this nature.

when a person dies for example, they would get a gift tax exclusion from the estate on which estate tax would be paid, of the one million. If your partner gifts you 300,000, then he only has 700 thousand left for the exclusion amount.

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