Question

Brian T calls you. His daughter is getting married. Brian and his wife would like to give the couple $100,000 to help them acquire a home. They would like to know how to structure the transaction.

A) What are the consequences if Brian writes a check to his daughter?

B) ways to minimize filing and gift taxes?

Answer 1

A) If a relative gives you gift in the form of cash/cheque or in consuderation, you will not have to pay anyntax on the amount received.

Gifts upto Rs. 50000 in a financial year is exempt from tax. However you receive gifts higher than this amount , the entire gift become taxable.

Here Brian writes a cheque of amount $100000, so it is fully taxable as it is more than Rs.50000.

B) One of the simplest ways to avoid having to file a gift tax return is to spread gifts over multiple calender years..