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 MequonCPA Your Own Question

MequonCPA
MequonCPA, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 2327
Experience:  CPA, Over 30 yrs experience w/individuals and small businesses. Masters in Tax.
5142404
Type Your Tax Question Here...
MequonCPA is online now
A new question is answered every 9 seconds

Hypothetically ***Got a one time gift over 10K but under 50k.

Customer Question

Hypothetically ***Got a one time gift over 10K but under 50k. Filed for an extension. Bought a car and don't know how to report it. Am also unemployed and a full time student receiving Pell Grants. So am always broke, but got a nice car in name with gift. Don't want gift to interfere with education. This gift has not been filed by the giftee' either and prob won't be...so.....suggestions?!?
Submitted: 3 years ago.
Category: Tax
Expert:  MequonCPA replied 3 years ago.

Hi and welcome to JustAnswer:

 

As the recipient of a gift there is no income tax reporting required. The individual that made the gift should be filing a gift tax return (Form 709). There is no gift tax due unless they have made taxable gifts of $5 million or more.

 

However, in preparing your FAFSA form the receipt should be reported as "Money received . . ." Line 44(j) of the form.

Customer: replied 3 years ago.
What if the person giving the gift will not be reporting it either way? And when putting the Money recieved on line 44. Will this effect the status of pell grant as far as my status goes.




What if a person pays more than 10k for a vehicle with no currency exchange form signed just a bill of sale and they deccide not to report it? Would ther be anyway the Fed could find this information and audit a person.


Expert:  MequonCPA replied 3 years ago.

The person making the gift should report it. It has no tax consequence and proves that your "windfall" was truly a gift.

 

Regardless of what the individual making the gift does, you are required to report receipt as Money received from others. It is no different than if they gave you the cash and you bought the car. A receipt of any amount could affect your pell grant depending on other income/asset items on your FAFSA form.

 

http://studentaid.ed.gov/students/publications/completing_fafsa/2010_2011/ques3-3.html

 

 

Customer: replied 3 years ago.
Does it have to be reported?
Customer: replied 3 years ago.
Does it have to be reported?
Expert:  MequonCPA replied 3 years ago.

Yes.

Customer: replied 3 years ago.
Can you explain the possible consequences if it isn't?
Expert:  MequonCPA replied 3 years ago.

The FAFSA includes the following warning on the front:

WARNING: You must fill out this form accurately. The information that you supply can be verified by your college, your state, or by the U.S. Department of Education.

 

You may be asked to provide U.S. income tax returns, the worksheets in this booklet and other information. If you can't or don't provide these records to your college, you may not get Federal student aid. If you get Federal student aid based on incorrect information, you will have to pay it back; you may also have to pay fines and fees. If you purposely give false or misleading information on your application, you may be fined $20,000, sent to prison, or both.

JustAnswer in the News:

 
 
 
Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.
 
 
 

What Customers are Saying:

 
 
 
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
< Last | Next >
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
  • I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight. Bonnie Chesnee, SC
  • Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation. John Minneapolis, MN
  • Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with. Orville Hesperia, California
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex Los Angeles, CA
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP Hesperia, CA
 
 
 

Meet The Experts:

 
 
 
  • Wallstreet Esq.

    Tax Attorney

    Satisfied Customers:

    570
    10 years experience
< Last | Next >
  • http://ww2.justanswer.com/uploads/KU/KUMI95/2013-9-30_195031_kumar.64x64.jpg Wallstreet Esq.'s Avatar

    Wallstreet Esq.

    Tax Attorney

    Satisfied Customers:

    570
    10 years experience
  • http://ww2.justanswer.com/uploads/CU/Cuttinggirl/2011-10-29_03719_wcrop2.64x64.jpg Wendy Reed's Avatar

    Wendy Reed

    Enrolled Agent

    Satisfied Customers:

    3052
    15+ years tax preparation and tax advice.
  • http://ww2.justanswer.com/uploads/CATax/2009-08-04_204548_Mark.jpg Mark D's Avatar

    Mark D

    Enrolled Agent

    Satisfied Customers:

    985
    MBA, EA, Specializing in Business and Individual Tax Returns and Issues
  • http://ww2.justanswer.com/uploads/IN/insearchoftheanswer/2013-8-16_0233_attorney.64x64.jpg Richard's Avatar

    Richard

    Tax Attorney

    Satisfied Customers:

    3229
    29 years of experience as a tax, real estate, and business attorney.
  • http://ww2.justanswer.com/uploads/MY/MyVirtualCPA/2012-7-5_44024_cookmegan1.64x64.jpg Megan C's Avatar

    Megan C

    Certified Public Accountant (CPA)

    Satisfied Customers:

    6121
    Licensed CPA, CFE, CMA who teaches accounting courses at Master's Level
  • http://ww2.justanswer.com/uploads/JG/jgordosea/2012-6-7_43138_GordosVeritas.64x64.jpg jgordosea's Avatar

    jgordosea

    Enrolled Agent

    Satisfied Customers:

    2783
    I've prepared all types of taxes since 1987.
  • http://ww2.justanswer.com/uploads/OZ/ozaukeecpa/2012-6-7_193219_Picture1croppedandshrunk.64x64.jpg MequonCPA's Avatar

    MequonCPA

    Certified Public Accountant (CPA)

    Satisfied Customers:

    2231
    CPA, Over 30 yrs experience w/individuals and small businesses. Masters in Tax.
 
 
 
Chat Now With A Tax Professional
MequonCPA
MequonCPA
CPA Firm Owner
2236 Satisfied Customers
CPA, Over 30 yrs experience w/individuals and small businesses. Masters in Tax.