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What are your thoughts on Gift Tax?

Topic closed. 20 replies. Last post 6 years ago by cope.

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Raven62's avatar - binary
New Jersey
United States
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June 28, 2005
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Posted: August 20, 2010, 10:39 pm - IP Logged

Anybody know what % the gift tax is?

It's also said that if you get something in return, it doesn't count as a gift. If you give your kids $50k and they have to wash your car every week, can the Government say it's too much money for the task?? Do you need written proof of service or product to present to the Government?

Gift Tax=40%

You can't Win: Pay the kids $50K to wash the car: They Pay Income Tax on the $50K.

A mind once stretched by a new idea never returns to its original dimensions!

    Hermanus104's avatar - 5027340606 1e360c8038_s.jpg
    Northern Virginia
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    December 5, 2009
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    Posted: August 23, 2010, 8:45 pm - IP Logged

    For many people out there, winning the lottery means they can help out friends and family members with financial problems. But Government requires the donor to file Gift Tax if the amount is over $12,000 (somewhere around there). Besides it being another way for the Government to take money away from generous people, what is the point of a Gift Tax?? How does Gift Tax benefit the people that the Government supposedly serve?

    Maybe that is why wealthy people don't give hand outs.

    Quid? I don't even think lotto winnings should be taxed. My guess is that the government considers it income, and therefore it needs to be taxed. I think lottery winnings should not be considered income and should not be taxed. You won the money; the government shouldn't take half of it away.

    Today's winning 3-ball is going to be a number between 000 and 999.

    In a lot of states, lotteries benefit education. That makes the REAL winners the only people who can't play!

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      United States
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      December 13, 2009
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      Posted: August 23, 2010, 8:54 pm - IP Logged

      For many people out there, winning the lottery means they can help out friends and family members with financial problems. But Government requires the donor to file Gift Tax if the amount is over $12,000 (somewhere around there). Besides it being another way for the Government to take money away from generous people, what is the point of a Gift Tax?? How does Gift Tax benefit the people that the Government supposedly serve?

      Maybe that is why wealthy people don't give hand outs.

      It sucks.   The money has already been taxed as income, it doesn't need to be taxed as a gift too.   A gift of $100,000 can cost the giver $55,000 in gift taxes.   Of course, it's a great excuse not to give too much out to relatives and friends.

      It's another reason for setting up a trust so what you give only gets taxed as income.

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        December 13, 2009
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        Posted: August 23, 2010, 9:01 pm - IP Logged

        Gift Tax=40%

        You can't Win: Pay the kids $50K to wash the car: They Pay Income Tax on the $50K.

        The giver pays the gift tax.   The recipient doesn't pay income tax on the gift received.   If it's a distribution from a trust then the recipient pays income taxes.   It still gets double taxed.   Then there's the inheritance tax...   Seems like the government wants all the rich people to declare London, England as their permanent residence and forgo US citizenship (the UK only taxes on domestic income not world income).   An awful lot of millionaires have townhomes in London and in Rio de Janeiro, one as a residence and the other where they actually spend some time.

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          Posted: August 23, 2010, 9:10 pm - IP Logged

          Quid? I don't even think lotto winnings should be taxed. My guess is that the government considers it income, and therefore it needs to be taxed. I think lottery winnings should not be considered income and should not be taxed. You won the money; the government shouldn't take half of it away.

          The lotteries are also government organizations so does it make sense for them to tax the money they give out?   If you've ever worked for the State, you know that the State refuses to pay sales tax as it would just be paying taxes to itself (bummer on the expense reports).   The same argument should apply to lotteries.   Of course lotteries are usually State governments and it's the Federal income tax that takes the big bite.

          In other countries (Canada, UK etc.), a lottery prize is considered a windfall and is exempt from income taxes if received as a lump sum.   If the lottery prize is via annuity payments then it's taxable as income however the annuity can be set to cover the marginal tax neglecting your other sources of income into account which means you still owe taxes but most of it is paid by the annuity until the government ups it's tax rate so the first year is close to tax free but not quite.

            cope's avatar - usconstitution
            Texas
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            February 3, 2010
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            Posted: August 23, 2010, 9:22 pm - IP Logged

            my avatar should adequately reveal my position on the gift tax.

            BE JOYFUL ALWAYS, PRAY CONTINUALLY, AND GIVE THANKS IN ALL CIRCUMSTANCES.