Find solution
Taxation of business entities.

Can my son give me a 13K gift from his business account w/o taxation?

  • I know the IRS allows gifts w/o taxation between parents and children. Does it have to come from a personal account or can it come from a sole proprietor business account which my son has. Is there any problem if he transfers the money to me from that business account. He already paid the 2011 taxes on the profit in that business.

  • Answer:

    Even though he has already accounted for and paid tax on the money, taking it directly from the business account is a red flag if he is audited. Save yourselves the possible grief and have him transfer it to his personal account and then give it to you.

Ann at Yahoo! Answers Visit the source

Was this solution helpful to you?

Other answers

LOL! "I know the IRS allows gifts w/o taxation between parents and children." WRONG! Gifts to children are treated in the same way as gifts to anyone else: there is no tax on the recipient but a gift tax form has to be completed if you give more than $13K to any single person in a year.

MadMan

Technically, he's paid the taxes and now is reducing his capital investment by the amount he gives you. Since he's giving you cash, he may have capital gains to declare.

Quick Answers

not a good idea to use a business check to give you a gift, not good business practice

tro

It makes no difference* He has already paid tax on the money and there is no tax liability for you.

Mathew

Related Q & A:

Just Added Q & A:

Find solution

For every problem there is a solution! Proved by Solucija.

  • Got an issue and looking for advice?

  • Ask Solucija to search every corner of the Web for help.

  • Get workable solutions and helpful tips in a moment.

Just ask Solucija about an issue you face and immediately get a list of ready solutions, answers and tips from other Internet users. We always provide the most suitable and complete answer to your question at the top, along with a few good alternatives below.