Author Topic: Paying Taxes On Money Transfers From Abroad?  (Read 1600 times)

AlmstRtrd

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Paying Taxes On Money Transfers From Abroad?
« on: March 27, 2016, 05:39:30 PM »
My wife's mom wants to wire money from abroad to help pay for college expenses for our daughter (not something that we really need but she wants to feel like she is helping out). Does anyone here have any experience having money wired into a US account from abroad and having to pay tax on the gift?

Here is an IRS page that I found:

https://www.irs.gov/Businesses/Gifts-from-Foreign-Person

Here's a quote from the link:

"In general, a foreign gift is money or other property received by a U.S. person from a foreign person that the recipient treats as a gift or bequest and excludes from gross income."

Seems straight forward enough but I don't want to take a surprise tax hit.

And, if you know something about this, can you please tell me what the tax-free limits are?

Many thanks in advance!


Cpa Cat

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Re: Paying Taxes On Money Transfers From Abroad?
« Reply #1 on: March 27, 2016, 07:02:22 PM »
There's no limit.

If you receive gifts over $100,000 from foreign sources, you would need to file Form 3520. But it's an informational form - it reports the gift, but doesn't have a tax liability associated.

If the gift is coming from a trust or other non-individual entity, the thresholds for filing Form 3520 are lower.

AlmstRtrd

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Re: Paying Taxes On Money Transfers From Abroad?
« Reply #2 on: March 27, 2016, 07:39:50 PM »
Got it and many thanks for your help!!