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Person A ( company ) is buying a product / invention from Person B for 7 figures. Person B wants to gift Person C with the funds. How do they acheive this while keeping taxes to an absolute minimum on both ends?
Person A ( company ) is buying a product / invention from Person B for 7 figures. Person B wants to gift Person C with the funds. How do they acheive this while keeping taxes to an absolute minimum on both ends?
There most likely wouldn't be any federal taxes involved for the gift. Just fill out IRS Form 709. If the gift will be less than $5.45 million there wouldn't be a federal gift tax. Person B could easily pay income taxes for selling to Person A.
Of course trying to hide a sale and claim it was a gift is tax fraud. Given the general value being spoken of I suspect the irs would be quite aggressive in prosecuting the matter if/when it's discovered.
Of course trying to hide a sale and claim it was a gift is tax fraud. Given the general value being spoken of I suspect the irs would be quite aggressive in prosecuting the matter if/when it's discovered.
I agree. This is absolutely something that must be discussed with a tax professional, in detail. In addition, even if everything is on the up and up, there is income tax that will have to be paid on the original sale, therefore the entire amount should not be gifted.
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