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  1. #1
    Katie Hance is offline Junior Member
    Join Date
    Mar 2008
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    Early distribution of inheritance

    What is the name of your state? Missouri
    Our mother would like to give each of three kids a one time distribution of our inheritance because she would like to see us enjoy some of it, or relieve our stress while she is still around. I understand there is gift tax on money over $12000 per person per year. I also understand that there is a tax form that can be filed with her federal taxes in regards to the money over the $12,000 for each person and that after computing that tax it is deducted from a kind of lifetime gift tax total, so she actually will not pay tax on this money now. However, one of my brothers is worried about being audited over this money and has found someone who suggested that there is an Early Distribution of Estate that can be done which eleviates all of t his . . . I want to settle this by the end of the week as I am in charge of all of this, and I agree with her, but I am getting tired of the struggle.

    Further Info as asked by Senior Members:

    Mother does not have a spouse.
    Two of us have spouses, so yes, we could each have $12000 checks, but that leaves one brother with only one $12000 check.
    Correct, mother is alive, so the "Early Distribution by Estate" never made any sense to me, but was suggested by an accountant in Colorado. I never found anything on that subject that made any sense for my situation.
    Doubtful that the one brother has anything to hide, but he hates hassles and paperwork, prefers simplification of everything . . . which is why I am the one doing the investigating.

    You guys are awesome! First time on a website doing this chatting kind of thing . . . I love it! Thanks for the help.
    Last edited by Katie Hance; 03-25-2008 at 09:48 AM. Reason: Questions from Senior Members
  2. #2
    seniorjudge is offline Senior Member
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    Location
    St. Odo of Cluny Parish
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    There is no estate to distribute since ma is still alive.

    Consult with a good tax accountant.

    Also, stand by for other help.
    There are two rules for success:

    (1) Never tell everything you know.
  3. #3
    tranquility is offline Senior Member
    Join Date
    Mar 2006
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    18,583
    Nothing to add to SJ's advice. Gift tax returns are required for any gift in a single year to a single person from a single person of over $12,000. No tax unless the giver exceeds his $1 million dollar lifetime exemption. If brother is worried, have his see a tax professional. To paraphrase a related saying, you have no "estate" until you're dead.
  4. #4
    curb1 is offline Senior Member
    Join Date
    Mar 2002
    Location
    oregon
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    2,063
    Why is brother worried about an audit? Nothing to worry about unless he is hiding something.
  5. #5
    Zigner is offline Senior Member
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    Jan 2005
    Location
    California
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    53,169
    Is Ma married? Are any of the recipients married?

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