Legal Question in Tax Law in California

Who is Responsible for Gift Tax..or Is There Any

Parents would like to give birthday gift of $50,000.00. Who is responsible for tax? Is a gift to a child taxable? If so who pays, parent or child? Do I need to report gift on my taxes or is it parents responsibility? Rather than writing a check to child would it have been better to gift 10K to child and then perhaps 10K to each grandchild. Are parents allowed to use funds if checks were sent in that way? What is the best way to receive a gift in that amount without being taxed? Or is the receiving end responsible for any tax at all.


Asked on 9/02/05, 2:19 am

1 Answer from Attorneys
Ken Koenen Koenen & Tokunaga, P.C.

Re: Who is Responsible for Gift Tax..or Is There Any

A gift can be made up to $11,000 per year, tax free. Each of your parents can give you $11,000 this year with no tax implications. If you are married, they can also gift $11,000 to your spouse, tax free. Then, they can wait until next year (January) to gift the remaining $6,000.

They can gift to your children, too, but those funds would need to remain in a trust account for their benefit.

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Answered on 9/02/05, 12:04 pm


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