Cash gift from visiting relatives

[karkmon]

What is the name of your state? Georgia

I am a US citizen and have a small job. Recently, my relatives living in another country visited me and gave me few thousand dollars as cash gift. I want to deposit this in my bank account. Someone told me that IRS may come after me suspecting that this cash is my earned income and I am evading taxes. What kind of document is preferable to get from my relatives confirming this cash gift?

 

[Just Blue]

What is the name of your state? Georgia

I am a US citizen and have a small job. Recently, my relatives living in another country visited me and gave me few thousand dollars as cash gift. I want to deposit this in my bank account. Someone told me that IRS may come after me suspecting that this cash is my earned income and I am evading taxes. What kind of document is preferable to get from my relatives confirming this cash gift?

Define "a few thousand dollars"...3k? 4k? 10?

 

[karkmon]

Thanks Sir. One relative (brother) gave me 7K and two aunts gave me 4K and 5K, total 16K

 

[Just Blue]

Thanks Sir. One relative (brother) gave me 7K and two aunts gave me 4K and 5K, total 16K

I'm not a "sir".

16 thousand dollars is not a few few thousand dollars. I'll tag a couple (2) of the tax experts to advise you. @Taxing Matters @LdiJ

 

[Ohiogal]

I'm not a "sir".

16 thousand dollars is not a few few thousand dollars. I'll tag a couple (2) of the tax experts to advise you. @Taxing Matters @LdiJ

Well that amount of a deposit will get you reported https://www.mybanktracker.com/checking/faq/rules-deposit-10000-cash-check-271595
And from where are your visiting relatives?

 

[LdiJ]

Thanks Sir. One relative (brother) gave me 7K and two aunts gave me 4K and 5K, total 16K

You will want to deposit the money all at once, in one transaction so as to not give the appearance of trying to structure deposits. Have your relatives put something in writing that they are giving you the gifts, and how much they are giving you. It is not all that likely that the IRS will question the deposits, but if you have it in writing, it will help you prove that the money was not income.

 

[karkmon]

My apologies to Just Blue.
Thanks everyone.

My relatives visited from Canada (one aunt), Asia (brother), and Europe (another aunt).

LdiJ: "It is not all that likely that the IRS will question the deposits, but if you have it in writing, it will help you prove that the money was not income. " One of my aunts is still here, and my brother and another aunt left back to their countries. What kind of letter (from each of them) is good enough from each of them?

For the people who already left: An email with his/her name, country name, passport number, visa number, date(s) of visit, amount he/she gave to me is enough? Or a written letter with the same info but physically signed and scanned and send by email is good enough? Or something else is needed?

What kind of letter is good from my aunt who is still here: the same above content on a price of sheet, hand written and sign, is enough?
please advice me what specific items are needed in each letter and the mode of the letter (email, scanned copy, hard copy, etc).

Any witness signatures are needed?

I was facing several issues and that's why, when they visited, they generously gave me these cash gifts but I and they should not be in any trouble due to these gifts or letters, and due to my deposit of this cash in the bank.

Please share your feedback.

 

[Ohiogal]

Where in Asia and Where in Europe? Under which countries passports do they travel?

 

[Taxing Matters]

What kind of letter (from each of them) is good enough from each of them?

A simple letter stating that they gave you a cash gift of $X on date Y that is signed by the relative should be sufficient. You don't need anything fancy nor does it have to be in some strict format.

For the people who already left: An email with his/her name, country name, passport number, visa number, date(s) of visit, amount he/she gave to me is enough? Or a written letter with the same info but physically signed and scanned and send by email is good enough? Or something else is needed?

Again, a simple letter signed by them should be sufficient. It's not like you need to have it in hand immediately. If they mailed it to you now it would arrive to you well before the IRS would come around asking about the deposit, if indeed it ever does.

Any witness signatures are needed?

No, but it wouldn't hurt either.

Where in Asia and Where in Europe? Under which countries passports do they travel?

I'm not seeing any of that as having any bearing on the tax question. It really doesn't matter where in the world the relatives live or what passports they use. With respect to the OP, the tax law will apply the same regardless.

 

[Ohiogal]

A simple letter stating that they gave you a cash gift of $X on date Y that is signed by the relative should be sufficient. You don't need anything fancy nor does it have to be in some strict format.



Again, a simple letter signed by them should be sufficient. It's not like you need to have it in hand immediately. If they mailed it to you now it would arrive to you well before the IRS would come around asking about the deposit, if indeed it ever does.



No, but it wouldn't hurt either.



I'm not seeing any of that as having any bearing on the tax question. It really doesn't matter where in the world the relatives live or what passports they use. With respect to the OP, the tax law will apply the same regardless.

Not my area.. but I was thinking it MIGHT help if the people in Asia or Europe were from countries known for ... ummm.. issues... I.E. India with their frauds....

 

[karkmon]

Thanks Taxing Matters.

Whether a person from another country, who is visiting US, can also receive cash gift from a US citizen living in US? In the future, if I am doing well financially, I am planning to give cash gift to my relatives (when they visit US again) who helped me now.

 

[LdiJ]

Thanks Taxing Matters.

Whether a person from another country, who is visiting US, can also receive cash gift from a US citizen living in US? In the future, if I am doing well financially, I am planning to give cash gift to my relatives (when they visit US again) who helped me now.

Yes, a US person can give a cash gift to someone living in another country. However, if you gift more than $15,000 to any one individual, in a single calendar year, you may have to file a gift tax return. You won't owe any tax until you reach your lifetime limit for gifting, and that currently is over 11 million dollars.

 

[karkmon]

Yes, a US person can give a cash gift to someone living in another country. However, if you gift more than $15,000 to any one individual, in a single calendar year, you may have to file a gift tax return. You won't owe any tax until you reach your lifetime limit for gifting, and that currently is over 11 million dollars.

"to someone living in another country" while that someone is in US on a visit?

 

[Taxing Matters]

"to someone living in another country" while that someone is in US on a visit?

Assuming you are a US citizen or resident the federal gift tax will apply to you the same regardless of to whom you give the gift or where in the universe you make the gift. Currently if you give a total amount of gifts to any one person in a single tax year that totals more than $15,000 you need to file a federal gift tax return. No matter where that person lives, no matter what country he or she is a citizen, no matter where you hand them the gift.

 

[karkmon]

Thanks a million.