Gifts From Non-Citizens to US Citizens
A gift is any transfer between individuals either directly or indirectly where full consideration- in money's worth- is not received in return.
A "foreign" gift is money or other property that a U. S. person receives from a foreign person & treats it as a gift & excludes it from income.
A "foreign" person is a non-resident individual, foreign corporation, partnership or estate.
These gifts do not include amounts paid on behalf of U.S. individuals for qualified tuition or medical payments.
- Gifts less than the annual exclusion for the calender year.
- Tuition or medical expenses paid on behalf of another person.
- Gifts to your spouse.
- Gifts to a political organization for it's use.
So when should one start getting worried? One needs to worry about Reporting Requirements & file a Form 3520, if the following apply:
- More than $100,000 from a nonresident alien individual or a foreign estate (including foreign persons related to that nonresident alien individual or foreign estate) that you treated as gifts or bequests; or
- More than $15,102 (for 2014) from foreign corporations or foreign partnerships (including foreign persons related to such foreign corporations or foreign partnerships) that you treated as gifts.
If you are the donor and your gifts are more than the annual exclusions as stated above, you need to file Form 709.
Consult with a tax professional for your unique needs and make sure your questions are answered. Always remember to read my disclaimer here. If you have any more questions regarding this or other tax matters, contact me at email@example.com.