A couple of new questions (I think)...cash gifts, pools winning option

Reply #9

stripesnsolids — Mon, 13 Feb 2012 22:48:58 GMT

I have an answer for your first question.

The new annual limit is $13k however you can deduct the taxes owed on any amounts over the annual limit from your unified credit (this is a lifetime deduction) for 2012 the amount is $1,772,800.

In this example the tax bracket is probably wrong but it's for illustration purposes only.

say you gave someone $100,000 and the gift tax on $87,000 (the amount after the first non taxable $13,000) is $6,000, you would deduct $6,000 from your $1,772,800... [ More ]

Reply #8

CDanaT — Mon, 13 Feb 2012 18:05:47 GMT

Here's a quote from the Powerball website in the FAQ section, CAN INDIVIDUALS IN A GROUP CHOOSE CASH AND ANNUITY ?...RESPONSE: An individual lottery may have individual rules on how they pay the winner ( how many checks; how many winners to process, etc.) but we can handle any request to divide the prize payment. We can divide the prize however the individuals in a group wish, including different requests for cash or annuity.

Reply #7

sully16 — Mon, 13 Feb 2012 14:08:16 GMT

I know if your buying a house from a relative for less than whats it's worth your allowed 12k in the gift of equity per person, as long as the equity is there.

Reply #6

Coin Toss — Mon, 13 Feb 2012 05:59:41 GMT

dk1421,

Sorry, I forgot it was your thread, CDanaT, your post.

Yeah, basically what I was asking is if you exceeded the gift limit could you at least make up to the limit exempt. Or would the tax people say something like gee, if you would have stayed under the limit there'd be no tax, unfortunately you went over......

As for a ppol choosing both options, interesting that we already have different answers, CDanaT's post and Stack47's. Maybe it's state by state.

Reply #5

Stack47 — Mon, 13 Feb 2012 02:52:49 GMT

Someone recently posted that a couple could give gifts of $26,000, that being the limit of $13,000 by each (I thought it was $12K).......but if they gave $50,000 let's say, could they call $26,000 of it a gift?

A married couple can each give someone a $13,000 for a total of $26,000 or the can give another married couple $52,000. To give one person $50,000, the first $26,000 would probably be considered a gift and I assume taxes must be paid on the other $24,000.

If players in a pool win... [ More ]

Reply #4

CDanaT — Mon, 13 Feb 2012 02:42:30 GMT

C.T.

That was my post just a few days ago.....The $13K is the standard that was set this year(2012) for 1 person to give to another ( like you give $13K to grandma) and available under the IRS.gov website publication 950 dated OCT 2011....The gift of $26K is called split gifting as a couple. Lets say you your wife agree to give the money to your grandmother ($13K from you and $13K from your wife) You can legally give her that but have to file a special IRS form(706 or 709) letting them know t... [ More ]

Reply #3

dk1421 — Mon, 13 Feb 2012 02:34:52 GMT

#1 - to my knowledge: If Tom and Mary win the lottery and want to give money to James Joyce, here is how they can do it for the most money without taxes: Tom gives $13k to James and $13k to Joyce. Mary gives $13k to James and $13k to Joyce. James and Joyce now have $26k each or $52k total as a couple. This is per year, but I do think there is a cap of $500,000 (?) for that person's lifetime.

Now my question the other day was: if you are in an LLC - does that count as one entity, or can my hub... [ More ]

Reply #2

savagegoose — Mon, 13 Feb 2012 02:21:25 GMT

as to part

2: does the entire pool have to unanimously choose annuity or cash option?

the answer is yes. ideally it should be decided before the pool starts collecting cash and mentioned to everyone so they understand. remember the lottery only want to deal with 1 person , the pool manager. and sure as heck dont wan tto cut checks for 20 people ea winning ticket.

its just more fun to take to lawyers and argue over in a pool.

Reply #1

gogidolim — Sun, 12 Feb 2012 23:40:34 GMT

Maybe the benefactot should give the money in installments.

A couple of new questions (I think)...cash gifts, pools winning option

Coin Toss — Sun, 12 Feb 2012 23:03:47 GMT

Don't think I've seen these covered:

1. Someone recently posted that a couple could give gifts of $26,000, that being the limit of $13,000 by each (I thought it was $12K).......but if they gave $50,000 let's say, could they call $26,000 of it a gift?

2. If players in a pool win a jackpot, does the entire pool have to unanimously choose annuity or cash option, or can the individuals choose one by one? I'm thinking that would be quite a trick but I'm not sure if it's allowed or not.... [ More ]