Are Monetary Gifts Taxable to the Recipient?

I know the maximum amount you can give (if single) is $12,000 in 2007. But does the recipient have to declare that gift as income and pay taxes on it?

Are Monetary Gifts Taxable to the Recipient?
Nope... "Tis better to recieve than to give" This is what my tax professor used to always say...Only the donor pays tax once they pass a certain threshold of 12k a year now to the same individual.
Reply:There is no limit on the amount a person can give. If the gift is over $12,000 in a single year, then the DONOR must file a gift tax return to report the gift. If there is a gift tax due, then the DONOR must pay the tax. The DONEE never pays the tax. The donor can give up to $1,000,000 of gifts in his/her lifetime before they would have to pay any gift tax. This is in addition to the gifts that fall under the $12,000 annual exclusion, which are not reportable.





Jim Kirby, CPA
Reply:No. IRS publication 950.
Reply:The person who receives the gift of any amount does not pay any federal tax or report the gift (unless it is from foreign sources).


There may be state tax. Check at your state web site.
Reply:No, gifts are not taxable to the recipient. And you can receive gifts from as many different people as you'd like and still pay no tax.





If a gift is over $12,000 - that does incur a possible tax - but not to you. The overage is subtracted from the giver's estate tax exemption, so in most cases, there won't be any tax determination until the giver's death.





A giver can give these $12,000 gifts to as many different people as he/she would like. More power to you if you are the recipient of such generosity!

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