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My brother in-law is a non US citizen, non-resident. He

Second opinion] My brother...

Second opinion] My brother in-law is a non US citizen, non-resident. He would like to gift my wife and adult children $100K each. He would like to use money he has invested in the US. Would he have to file a gift (form 709) in the US and pay taxes?

Accountant's Assistant: The Accountant will know how to help. Is there anything else important you think the Accountant should know?

The money he has invested in the US is in the form of mutual funds, he would sell these and make a cash gift.

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11/2/2017
Chad EA, CDFA®, CFP®
Chad EA, CDFA®, CFP®, CERTIFIED FINANCIAL PLANNER ®, Professional
Category: Tax
Satisfied Customers: 2,767
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H​ello! My name is ***** ***** I will be able to assist you today.

Your brother in law would have to pay tax on any gain or loss from the sale of the mutual fund.

If he was gifting to each you, your wife and your children a $100,000 you, your wife and your children would have to file IRS From 3520. If he is not a US Tax payer then he would not need to file form 709.

Below is an excerpt from the IRS.Gov site

"You must file Form 3520, Annual Return to Report Transactions with Foreign Trusts and Receipt of Certain Foreign Gifts, if, during the current tax year, you treat the receipt of money or other property above certain amounts as a foreign gift or bequest. Include on Form 3520:

  • Gifts or bequests valued at more than $100,000 from a nonresident alien individual or foreign estate (including foreign persons related to that nonresident alien individual or foreign estate);"

.

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I​f the gifts are under $100,000 then you would not be required to file form 3520.

If you have any further questions please let me know.

Thank you!

Chad EA, CDFA®, CFP®
Chad EA, CDFA®, CFP®, CERTIFIED FINANCIAL PLANNER ®, Professional
Category: Tax
Satisfied Customers: 2,767
Experience: IRS Licensed Enrolled Agent, CDFA ® CFP ®, MBA
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T​hank your for the rating!

Have a great evening!

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