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 Arthur Rubin Your Own Question
Arthur Rubin
Arthur Rubin, Tax Preparer
Category: Tax
Satisfied Customers: 1515
Experience:  22 years of tax preparation experience, including individual, trust, and estate returns.
13714381
Type Your Tax Question Here...
Arthur Rubin is online now
A new question is answered every 9 seconds

I have a joint savings account with someone. He is the primary

This answer was rated:

I have a joint savings account with someone. He is the primary on the account. He wants to take his name off of the account so that it will be in my name only. I would then become responsible for paying the taxes on the account. When the account is put in my name only, will the IRS require me to pay taxes on the entire amount of money in the account, as though it were new income? Or will I only have to pay taxes on the interest earned, as the primary has been doing all along.
The answer depends on ownership form (joint tenancy or tenants in common), and source of the funds of the account. If you're not doing anything for him in return, it would almost certainly be considered a "gift" of his share of the account to you. If his total gifts to you in the year exceeds $13,000, he would need to file a gift tax return. He wouldn't have to pay anything unless his lifetime total excess gifts exceed $1,000,000, or (if the estate tax is reinstated), excess gifts plus the estate exceed the exemption.
Customer: replied 6 years ago.
-Our savings account is a joint tenancy and I have deposited all of the money in it  over the past ten years.  I'd like to have the account in my name only now, but I don't want to have to pay income taxes on the entire amount of money in the account.  Is that what's going to happen, or will I only have to pay taxes on the interest earned after it is put in my name? 
Thank you for clarifying. No, under those circumstances, the transfer might have gift tax effects, but only the interest on the account is taxable to either of you. In theory, you probably should have been paying taxes on at least half, if not all, of the interest in previous years, but the IRS probably won't come after you for that.
Arthur Rubin and 4 other Tax Specialists are ready to help you