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I live in CA and was given a 25k check by my grandfather as ...

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I live in CA and...
I live in CA and was given a 25k check by my grandfather as a gift a the end of december. Of this check 5k of it cleared last week of dec but the rest not till the second week of January. What are the tax implications?
Submitted: 9 years ago.Category: Tax
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4/1/2008
Tax Professional: Lou, Tax Preparer replied 9 years ago
Lou
Lou, Tax Preparer
Category: Tax
Satisfied Customers: 404
Experience: 25+ yrs Experience Personal Income Taxes - Former DM for H&R Block in California
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Hello and thank you for contacting Just Answer. We appreciate the opportunity to be of service to you.

You will have no tax liability for the gift you received, however your grandfather will have to file a Gift Tax Return because the gift exceeds the 2007 limit of $12,000. If your grandmother is alive that limit would go to $24,000. In either case the limit is exceeded and the return must be file. Whether the giver has to pay a tax is determined by the Unified Credit per gift per person of $345,800. Here is a link to IRS Pub 950 that covers Gift Tax:

http://www.irs.gov/pub/irs-pdf/p950.pdf

Here is another link to an overview of the subject:

http://www.irs.gov/newsroom/article/0,,id=107815,00.html

If you have any follow-up questions please contact me.

Lou
Lou, Tax Preparer
Category: Tax
Satisfied Customers: 404
Experience: 25+ yrs Experience Personal Income Taxes - Former DM for H&R Block in California
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Tax Professional: Lou, Tax Preparer replied 9 years ago
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