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jgordosea
jgordosea, Enrolled Agent
Category: Tax
Satisfied Customers: 3007
Experience:  I've prepared all types of taxes since 1987.
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MY PARENTS WANT TO GIVE ME $50000 AS A GIFT IN CASH. THE THING

Resolved Question:

MY PARENTS WANT TO GIVE ME $50000 AS A GIFT IN CASH. THE THING IS THAT THEY DON'T LIVE HERE IN AMERICA. MY QUESTION IS WHEN I GET THAT $50000 THROUGH BANKS, DO I HAVE TO PAY TAX AT THE END OF THE YEAR. I JUST WORK PART TIME RIGHT NOW AND MAKE $500/MONTH. I AM A SINGLE MOM OF 1 CHILD. IS GETTING THAT MONEY GONNA AFFECT MY MEDICAL BENIFIT FROM STATE( ME AND MY DAUGHTER ARE GETTING FREE MEDICAL CARE FROM STATE)
Submitted: 4 years ago.
Category: Tax
Expert:  jgordosea replied 4 years ago.
Greetings,

Gifts that you receive, in any amount, are not included in income that is subject to income tax; so, no, there is no tax to pay at the end of the year when what you got is a gift.


Most need based assistance programs do have a limit on how much money you can have and still be eligible.
You will have to check with the state program (Medicaid, CONNECTICUT Child Health Insurance Program, etc.) you are using to know for sure what getting that much of a gift will do to your benefit. I can not help with that.
You are wise to check before you get the gift.

I hope this helps to know there is no income tax on gifts you get.
Best wishes.
Customer: replied 4 years ago.

can you explain a little bit more for me about money as a gift. I just want to make sure that my money won't be charged once it is sent to me. Hopefully I don't have any more question for you so I can pay.

 

Thanks alot

Expert:  jgordosea replied 4 years ago.
Hello again,

Money can be sent to you for many reasons.

If it is money from selling something I owned or for work that I did then it would be included in my federal tax return when I file as a resident or citizen of the United States regardless of where the money was earned or the item was sold.

If it is a gift (and not in exchange for my property or services) then it is not income that has to be reported on my federal income tax return, whether the gift was from inside or outside the United States.

Sometimes it is useful to have a letter or other document from the giver that states the reason for the money being sent; so there is no confusion that the money was a gift.

I hope this helps explain what a gift has to be - money to me not for anything I did or sold.

You are quite welcome.
jgordosea, Enrolled Agent
Category: Tax
Satisfied Customers: 3007
Experience: I've prepared all types of taxes since 1987.
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