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Old 07-05-2010, 12:33 PM
 
Location: Chicagoland
5,749 posts, read 10,343,086 times
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Quote:
Originally Posted by johnnytang24 View Post
It doesn't work. It only works in movies. As a US citizen, you'll be required to show your passport and they will report your new account.
I wondered how it worked.... I lived in the Caribbean years ago and they were always advertising these offshore bank accounts.... Maybe reporting has changed since then...
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Old 07-05-2010, 03:36 PM
 
Location: In America's Heartland
929 posts, read 2,087,683 times
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The gift tax limit is the main concern for your parents. Have them see a good attorney.
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Old 07-09-2010, 09:05 AM
 
14,780 posts, read 43,532,552 times
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Quote:
Originally Posted by debtmonger View Post
The gift tax limit is the main concern for your parents. Have them see a good attorney.
Best advice in the thread. You need to consult an attorney and/or an accountant to see the best way to handle this. That way your confidentiality is preserved and you get the best advice you can buy and assistance in getting it done legally with the fewest headaches possible.
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Old 07-09-2010, 01:39 PM
 
40 posts, read 109,012 times
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About 15 years ago, my friends parents sold their business and purchased their home cash. They went to the title company with a suitcase full of cash. The title company locked the doors, counted the cash and got their home.
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Old 07-09-2010, 01:54 PM
 
9,803 posts, read 16,129,165 times
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IRS scrutinizes gifts.

Be sure all "i's" are dotted and "t's" crossed.
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Old 07-09-2010, 02:59 PM
 
Location: Chapel Hill, N.C.
36,499 posts, read 53,854,975 times
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With this much money involved it is critical to get a good attorney to help you. Your parents could be hit hard with gift taxes and that generosity could come back to bite them in the b--t.
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Old 07-10-2010, 01:55 AM
 
680 posts, read 1,914,985 times
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Quote:
Originally Posted by no kudzu View Post
With this much money involved it is critical to get a good attorney to help you. Your parents could be hit hard with gift taxes and that generosity could come back to bite them in the b--t.
Let me preface this by saying that I am not a lawyer nor a CPA.

A few of the posters have mentioned the $13,000 annual gift exclusion and finding ways to get around this... But I did want to make you aware of the Lifetime Gift Limit/Unified Credit

2010 is kind of a weird year in that the Gift/Estate taxes are being reviewed.

In 2009, there was a $1,000,000 lifetime gift limit (above the $13K annual exclusion). This meant that over your lifetime, you would have been able gift anyone up to $1,000,000 with no tax.

Your parents could have given you $100,000 every year for the next 10 years. They could have even give it all at once if they wanted to.

In 2010, due to the review/repeal, it is my understanding that this gift limit is actually unlimited, but that they are set to bring it back down to $1,000,000 in 2011.

In any event, your parents are only giving you $100,000 so you should be good either way as long as you fill out IRS form 709 properly.

Most CPA's should be able to answer this question precisely.... but I don't think you have anything to worry about as long as all the cash is legit.

Good luck!
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Old 07-10-2010, 02:34 PM
 
9,803 posts, read 16,129,165 times
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Quote:
Originally Posted by volk2k View Post
Let me preface this by saying that I am not a lawyer nor a CPA.

A few of the posters have mentioned the $13,000 annual gift exclusion and finding ways to get around this... But I did want to make you aware of the Lifetime Gift Limit/Unified Credit

2010 is kind of a weird year in that the Gift/Estate taxes are being reviewed.

In 2009, there was a $1,000,000 lifetime gift limit (above the $13K annual exclusion). This meant that over your lifetime, you would have been able gift anyone up to $1,000,000 with no tax.

Your parents could have given you $100,000 every year for the next 10 years. They could have even give it all at once if they wanted to.

In 2010, due to the review/repeal, it is my understanding that this gift limit is actually unlimited, but that they are set to bring it back down to $1,000,000 in 2011.

In any event, your parents are only giving you $100,000 so you should be good either way as long as you fill out IRS form 709 properly.

Most CPA's should be able to answer this question precisely.... but I don't think you have anything to worry about as long as all the cash is legit.

Good luck!

I don't believe a word in this post and would caution anyone from following this advice.

What you are talking about is lifetime gift limits that one can make.
That lifetime limit can not be to one person.


You atre giving out false information that would get a person iin trouble with the IRS if he listened to you.

Please refrain !
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Old 07-10-2010, 09:52 PM
 
680 posts, read 1,914,985 times
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Quote:
Originally Posted by marmac View Post
I don't believe a word in this post and would caution anyone from following this advice.

What you are talking about is lifetime gift limits that one can make.
That lifetime limit can not be to one person.


You atre giving out false information that would get a person iin trouble with the IRS if he listened to you.

Please refrain !
Marmac... you clearly are not a CPA... Do you understand how gift taxes work?

Let me refer you to the IRS publication 950:
http://www.irs.gov/pub/irs-pdf/p950.pdf

Now this is a little dated since it refers to 2009... but 2010 should be even more lenient.

OP: As I mentioned, please double check with your CPA.
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Old 07-10-2010, 10:32 PM
 
680 posts, read 1,914,985 times
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Thought I would give a napkin math example for Marmac.

Let's take the OP's case.

OP's parents give him $100,000. I'm going to simplify this even further and say that just the OP's dad gives him $100,000.

That would mean that the OP's dad would owe tax on $87,000 ($100,000 minus the $13,000 annual exclusion)

The gift tax on $87,000 would be: $28,760.....

However, the OP's dad can elect to use his Lifetime/Unified Credit.... of which we are allowed tax credits of $345,800 (which equals out to that one time gift of about $1,000,000 that I mentioned in my earlier post)

Now the OP's dad only has a Lifetime/Unified Credit of $317,040 left ($345,800-$28,760)..... so he can continue gifting the OP $100K every year for the next 10 years if he would like to.

Because the OP's dad elected to use this credit, he owes NO tax on the $100K he has given to the OP.

Please keep in mind that this Lifetime/Unified Credit encompasses ALL of the gifts that the OP's dad may give out over his lifetime... not just to the OP.

So if he gives $100K to ten people this year, he can no longer gift out amounts over $13,000 per year to anyone for the rest of his life.... unless he is willing to pay taxes on them of course.

The IRS can't tell you how much you can or cannot give to anyone, but they'll try to "tax" you out of it

Last edited by volk2k; 07-10-2010 at 10:41 PM..
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