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Old 04-03-2013, 02:38 PM
 
38 posts, read 105,618 times
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Question!

I have a joint credit union with my son. He is over 18 and is listed first on the account and receives the 1099. I have been making deposits in it over the years and was planning on giving him the money when he graduates from college.

If I were to take 8000$ out for a down payment is this considered a gift? After all either party can withdraw?

Thanks
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Old 04-15-2014, 06:06 AM
 
Location: Missouri
592 posts, read 714,507 times
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What would the down payment be for?
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Old 04-15-2014, 11:44 AM
 
Location: SoCal desert
8,092 posts, read 14,022,217 times
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AFAIK, if it is a JOINT account, any signer on the account can do anything they want.
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Old 04-17-2014, 07:23 AM
 
750 posts, read 1,616,312 times
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The prior responses to your question are all a bunch of bunk.

The reality is that you've been funding this joint account, either in whole or in part over the years, and now plan to turn the money over to your son. The IRS considers this a gift. Note that any individual (donor) can gift funds to any other individual (donee) up to the annual and lifetime gift exclusions (currently $14,000 and $5.25 million, respectively). Above these limits, the donor is responsible for filing the appropriate IRS forms and paying the tax.

Given that this transaction is less than the exclusion limit, you do not need to file. However, if you gift additional funds in the same calendar year that total in excess of the limits, you will need to file with the IRS and are responsible for any resulting tax.
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Old 04-17-2014, 11:56 AM
 
Location: SoCal desert
8,092 posts, read 14,022,217 times
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Quote:
Originally Posted by Iggier View Post
The prior responses to your question are all a bunch of bunk.

The reality is that you've been funding this joint account, either in whole or in part over the years, and now plan to turn the money over to your son. The IRS considers this a gift. Note that any individual (donor) can gift funds to any other individual (donee) up to the annual and lifetime gift exclusions (currently $14,000 and $5.25 million, respectively). Above these limits, the donor is responsible for filing the appropriate IRS forms and paying the tax.

Given that this transaction is less than the exclusion limit, you do not need to file. However, if you gift additional funds in the same calendar year that total in excess of the limits, you will need to file with the IRS and are responsible for any resulting tax.
Wrong in this instance.

Cmm1's name is on the account and has always had access to the money, so it's not a gift to the son.
It's only a gift when you no longer have access.

The son's name is on the account.
He can't gift himself.
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Old 04-17-2014, 06:45 PM
 
750 posts, read 1,616,312 times
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In the end it matters not where the the father housed the funds. He gives the son $8k. This is a gift as far as the IRS is concerned. On its own, however, it is below the IRS reporting threshold.
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Old 04-18-2014, 03:42 PM
 
3,627 posts, read 13,532,454 times
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Since the money was put in the account, perhaps during a different year, wouldn't the gift clock start when the money went in since he had access to it all along?
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Old 04-19-2014, 03:45 PM
 
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Why not just take your name off the account and leave it at that?
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Old 04-19-2014, 10:35 PM
 
63 posts, read 112,085 times
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Or have him walk in and withdraw it? Once he is able to withdraw it, (meaning no restrictions on the account placed by the parent), he can do with it as he pleases. One could argue the money was the child's all long as an monthly allowance or money raised from a paper route and the parent was only "collecting" the money to put it in since the child "didn't know how".
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