$12k cashier check... do I/ how? report as income? (pay, taxes, reporting)
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Well, I got this check now in 2010, but with tax-time on my mind, I'm wondering how to process...
It's long and convoluted... with family issues (ugh) I'll spare you the emotional details, and try to stick to the facts...
Grandma put money in my name (Uniform Gift to Minors Act) and when I turned 18, I was now responsible for "reporting" it to IRS. My mom refused to share any info about it (we have issues) and refused to give me the money (I was paying for college myself... not blowing it at the mall)
So, I said, if it isn't "for me"... take it back. Don't keep money in my name (screwing with my financial aide package) if I'm not allowed to use it, or know what it's about. Sure enough, mom lets me sign it over.
Fast Forward 15 years. I get a call... my mom wants to give me the money. I ask, do I pay taxes on it? She says, no, she's been paying taxes on it all along.
These were "shares?" that were cashed in. It was done by her... I never signed a thing. Today, I simply get a cashier's check from mom for $12k.
So my mom "says" she's been paying the taxes on it "all these years." I don't know what that means... I have a sneaking suspicion she was using the money? and doesn't want me to know? Otherwise what taxes are there to pay?
Do I believe her, (that I have no tax to pay) as I have no way to look up any of these transactions?
She is the only one living who would know the truth... but between lies and outright delusions, I don't know if even she can seperate fact from "what she wants me to think"
Can I just put the check in a savings account and call it done? For example, if my dad writes me a $100 check for my birthday, I don't report it as income. Can I treat this the same way? Or is $12k too much?
Other silly point (I hope to find out tomorrow) she made the cashier check in my maiden name...but I've been married 12 years. And she mis-spelled it. Will I get hassled at the bank?
To late now but if you two had been getting along she could have given you tax free with no ? asked $10,000 this year and $2,000 next year and you would have been under the radar screen.
On a home deal some time ago my brother gave $10.000 and his wife gave my wife $10,000 all tax free and as gift.I do not know anything else.
The IRS allows giving up to $13,000 in 2009 and 2010 to any number of people, every year, without facing any gift taxes, and without the recipient owing any income tax on the gifts.
Grandma put money in my name (Uniform Gift to Minors Act) and when I turned 18, I was now responsible for "reporting" it to IRS. My mom refused to share any info about it (we have issues) and refused to give me the money (I was paying for college myself... not blowing it at the mall)
So, I said, if it isn't "for me"... take it back. Don't keep money in my name (screwing with my financial aide package) if I'm not allowed to use it, or know what it's about. Sure enough, mom lets me sign it over.
You know that money was yours the moment you turned 18. There is nothing your mother could've done if you showed up at the bank that had it and asked for it.
The money was gifted to you whenever it was put on the account not in 2010. So you'll have to go back and figure what the rules were back then. The only taxes that might have been due after that would have been on any gains. But then I guess when you signed it over to her you might have re-gifted it. Just call the IRS they should be able to give you an answer.
The IRS allows giving up to $13,000 in 2009 and 2010 to any number of people, every year, without facing any gift taxes, and without the recipient owing any income tax on the gifts.
The gift tax question is answered, but gift tax is not income tax. In any event, the recipient of a gift or estate bequest is never responsible for gift/estate tax - the giver/estate is.
It sounds like you gifted the money (probably a mutual fund account or something similar) to your mom back when you were 18, then she turned around and regifted the proceeds to you 15 years later. She would have properly paid the taxes on the income (dividends/interest/capital gains) over the past 15 years. Do you remember how much there was to start with 15 years ago? Maybe she let it grow, maybe she used some, but who knows?
Anyway, the question for you to determine is when the regifting occurred. If it was after she sold the shares in the mutual fund, then she's responsible for the capital gain taxes if the shares were sold at a gain. If the gift was made to you before the shares were sold, then you bear the responsibility for the taxes on any gain on the sale.
But, since you said you didn't fill out any paperwork, it sounds like your mom sold the shares and you just got a check for the proceeds, either from your mom's bank or directly from the mutual fund. If that's the case, you have no tax consequences - you're just the recipient of a gift from your mother.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
