Gifts of Money or Property to Friends

[circawdm]

What is the name of your state (only U.S. law)? Iowa

Do the same laws apply to friends/non-family who wish to give someone some money or property because they can afford to and their friend cannot, or just simply as a gift? How many men fill out a form when they give their fiancée an engagement ring worth more than $13,000? Or gifts to that person in a calendar year that exceed the $13,000, cash or otherwise?

How picky is the IRS on non-family gifts or property or money between friends and non-relatives? Do they seriously expect people to report this or even know what the value is all the time, since it can be very "subjective" I am sure. I know someone who is very well off and they have a close friend they want to help out with a new roof for their home - $14-16,000 probably. Can't they do that without filling out a form?

When you think about all the people who help their friends - movie stars who give $20-30,000+ watches or other jewelry - even cars - to their close friends, because they can afford to do it? Are they all expected to file these special gift tax forms? I understand the principle of protecting against families paying estate taxes and other things similar to that. I don't think it is realistic or fair if someone gives someone they love or like a gift valued at over $13,000 for 2009, and they need to then worry about whether they will be put in jail or fined if one or both do not fill out the proper form.

This is, I believe, a very legitimate and overlooked question, and one I hope to hear some good and realistic replies to, since it could apply to millions of Americans at some time in their lives.

Thanks very much.What is the name of your state (only U.S. law)?

 

[anteater]

Are they all expected to file these special gift tax forms?

Simply put, yes.

However, the IRS does not have a "Gift Tax Return Squad" hunting down the miscreants. I'll leave it at that.

Perhaps you can write to your congresspersons and request a "friends and family" exemption.

 

[circawdm]

Thanks

Simply put, yes.

However, the IRS does not have a "Gift Task Return Squad" hunting down the miscreants. I'll leave it at that.

Perhaps you can write to your congresspersons and request a "friends and family" exemption.

Thanks for your succinct and abit enigmatic answer. If you are saying every man who gives his girlfriend over a year period more than the total for that year in gifts - of whatever kind, ought to be filing forms, I'd guess there are millions of felons out there annually. Ditto, friends giving to friends. I was hoping for perhaps a suggested legal "work-around," like a trust of some kind, or "forgivable" loan or something if the person is going to be giving their friend gifts over a long term exceeding the annual limits. Perhaps that is not feasible, or you see only one solution.

Thanks for your time in any event.

 

[anteater]

It was not enigmatic. It was indeed succinct since there was nothing further to add to respond to your post.

What's so hard about filling out and filing a simple form?

[Forgiving a loan is a gift, also]

 

[davew128]

Did you finish your homework or is this another one of those "my barber told me" things?

And by the way, failing to file a gift tax return is not a felony.

 

[LdiJ]

Its honestly kind of an interesting discussion...because there are "gifts" and there is "support".

I would guess that if someone is a member of your household (and is not an employee) that anything provided to them is going to be viewed as "support"...whereas if someone is not a member of your household, its going to be viewed as a "gift".

I would certainly guess that quite a few wealthy parents provide items to their college age (but adult) children..or even non college adult children who live in their home, that are far in excess of 13k per year, but gift tax returns are never filed, nor would the IRS expect them to be filed.

I would also expect that an engagement ring, which is a conditional gift, would be viewed a bit differently as well. After all, after the marriage its marital property.

 

[circawdm]

Thanks

Did you finish your homework or is this another one of those "my barber told me" things?

And by the way, failing to file a gift tax return is not a felony.

Thanks for the comment, but there was really no need to question if I am doing "homework" or thinking I am stupid enough to trust anything a barber would say. That's why I came here - for serious replies from what I felt would be seriously educated and sincere people. I guess some are more so than others.

Have a nice day Dave.

 

[LdiJ]

Thanks for the comment, but there was really no need to question if I am doing "homework" or thinking I am stupid enough to trust anything a barber would say. That's why I came here - for serious replies from what I felt would be seriously educated and sincere people. I guess some are more so than others.

Have a nice day Dave.

We do get quite a few questions on these forums that are clearly someone's "homework". Your post honestly did look a bit like homework.

We are NOT authority for homework.

 

[circawdm]

Way Past Homework Days

We do get quite a few questions on these forums that are clearly someone's "homework". Your post honestly did look a bit like homework.

We are NOT authority for homework.

Well, at age 59, (60 in October), I am way beyond homework, (thank goodness), other than seeking questions for myself or someone close. I can see where that might be an issue, but is not with me I can assure you. I appreciate again your first response.

Thanks again.