Ok, then we are in accord. My parents made us put 50% of every cash gift we received into our savings accounts which our parents controlled. My siblings and I ended up with tidy sums when we became legal adults. Its was peanuts in today's dollars, but mine paid for my 1st year college tuition and my sister's paid for her first car.
If Aunt Polly makes a gift to Sam, who is 13, of $10,000 with no restrictions — just gives him a check for it in his name — then that is a gift of a present interest. If Sam's parents then decide to take the money and invest it for him and not let him spend it as he wishes that won't change that it was a gift of present interest. The parents are simply exercising their right under state law to manage their kid's property. Note that in some states, especially California and Florida that have lots of child actors, models, and athletes, the parent's power to manage their kid's property may be regulated or restricted.
Correct.
That depends on the circumstances. If because of the circumstances the IRS thinks that the cash may be income, the taxpayer has to provide information to the IRS to show that the money was not income, e.g. was a gift. Similarly, if the circumstances are such that the cash might appear to a law enforcement agency to have been from illegal activity, the person may need to show that he got it from something else. If he can't do that, he might end up losing the money to forfeiture.
It is legal under U.S. law. No law prevents a foreign person from making a gift to a citizen (other than laws that prohibit foreign influence of U.S. public officials). The foreign person would have no worries about gift tax for gifts totaling $15,000 or less to any one person. For larger gifts made, the details of the gift matter. A non resident alien can, if he does it right, may make most gifts to a U.S. person tax free regardless of amount. The details of how and when a non resident alien is subject to U.S. gift tax can get complex and is something that beyond the scope of what can be easily discussed on a message board forum.
Again, a gift is not taxable to the donee and the donee can do what he or she wants with the property he received. However, U.S. citizens and residents must report large gifts received from foreign persons on IRS Form 3520. If the gift is received from a foreign corporation or partnership and exceeds $16,388 it must be reported, and for gifts received from foreign individuals or foreign estates it must be reported if the gift exceeds $100,000. These amounts can change each year, so you have to check the Form 3520 each year to see what's required. Form 3520 is just an information return — there is no tax imposed on the gift. But failing to file can result in penalties.
The U.S. does not restrict how much money a person may take in or out of the country nor does that result in any tax. However, any person (or group of persons traveling together) entering or leaving the U.S. with more than $10,000 in cash, traveler's checks, or other bearer instruments of any currency (whether dollars, pounds, Euros, Yen or whatever) must report that to the U.S. Treasury Financial Crimes Enforcement Network (FinCEN) on Form 105. Again, while there is no tax for taking cash in or out of the country, the failure to file the form may result in penalties.
