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In the next 3 weeks I will be moving to a new location - my parents have set aside $10,000 for us.

My parents can transfer this money from their account to my account - because we share a credit union - but I am concerned about tax payments that I might need to make from receiving this gift.

Ideally, if I were to receive the whole amount, I would use the amount I need for our upcoming move and put the rest into a CD - although my parents have offered to give some of the gift to us, and put the rest into a CD in our name.

The short of it is - what is the best way for me to receive this gift from my parents while minimizing any taxes I or my parents would need to pay?

For context - I live in the United States, both my parents and I live in New York, and I will be moving to Maryland in July.

Ben Miller
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Zibbobz
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1 Answers1

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First, gift taxes are on the giver, never the recipient. No matter what, if it is truly a gift, which it sounds like this is, it will not be considered taxable income for you.

Second, there is an annual gift tax exclusion of $15,000 per person. This means that gifts under this amount are not reportable or taxable for the giver. And the amounts double if the giver or the recipient are married, which means that if your parents are married, they can collectively give you $30,000, and if you are married, they can give your spouse another $30,000, all without reporting or paying tax on the gift. Above these amounts, the gift is reportable (on IRS Form 709), but there are lifetime exclusion amounts before the gift is actually taxable.

To explicitly answer your question, this gift of $10,000 has no tax implications whatsoever.

Ben Miller
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