My father has been generous enough to offer me a gift for a house downpayment.
Do you know if I need anything saying that it is a gift and does not be repayed?
Should I have the money before I go for preapproval/prequalification?
Do I need to claim this gift on my taxes? (If so, what is the upper limit that I wouldnt need to claim?)
Thanks!
belle31125
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Re: Downpayment gift?
I think the gift has to be less than 22,000 or something like that.. also you would have to get a letter saying that the money doesn't have to be repayed... you can get that from whomever youre getting your mortgage from... I believe...
KarenB
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Re: Downpayment gift?
Gifts have to be $10,000 or under, otherwise they are taxable. He could give you $10,000 and your FH $10,000. That still only gives you $20K. I'd see an accountant to find out if there is anything you can do.
belle31125
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Re: Downpayment gift?
That's right... I forgot... one parent can give you money and then the other can give you money .. that's legit.. also giving some to your FH and some to you
sophie78
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Re: Downpayment gift?
I think gifts are not taxable regardless of the amount.
BlazeSyth
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Well the gift was going to be 10K - I was just thinking if I should ask Dad for a check for 10,000 or 9,999
Sweetie2004
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Re: Downpayment gift?
We got a gift over $10,000 - do we have to pay tax on that or does the gift giver?
Hazeleyes33
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Re: Downpayment gift?
It can only be up to $11,000. I know this because my grandfather just died and my parents gave my sister and myself money and my father said it could only be up to $11,000 before they ask about it and tax you.
skew
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Re: Downpayment gift?
although i know you are all correct, i think that it is BS. isn't it considered double taxation? if one works to earn money (pays taxes on it) and then decides to give someone money as a gift (let's say 20k), why should the receipient be taxed when the giver already paid the taxes on it?.
and don't EVEN get me started on the 50% death tax. aren't they 'supposed' to do away w/ it?
dandj
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Re: Downpayment gift?
The mortgage company is also going to ask you to sign a gift letter and show proof that it was a gift. Basically your parents have to sign that they are giving you a certain amount of money.
Also, make sure they give it to you in a bank check because it makes it easier to prove that it went into your account quicker, which the mtg. company will also ask for.
KimberlyBride
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Re: Downpayment gift?
skew
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Re: Downpayment gift?
why are you required to show where it came from? why does it matter?
KimberlyBride
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Re: Downpayment gift?
dengal
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Posted by skew
why are you required to show where it came from? why does it matter?
They want to ensure the funding came from a documented source and you didn't get the money from any illegal activity.
SeptemberBride03
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Re: Downpayment gift?
The 10k gift tax limit was raised to 11k a few years ago. So you and DH can each get 11k from your dad without being subject to a gift tax. If your Dad is married, then you can double that b/c his wife can give the same.
IrishBride-05
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Re: Downpayment gift?
Posted by dandj
The mortgage company is also going to ask you to sign a gift letter and show proof that it was a gift. Basically your parents have to sign that they are giving you a certain amount of money.
Also, make sure they give it to you in a bank check because it makes it easier to prove that it went into your account quicker, which the mtg. company will also ask for.
There is a form that your mortgage company can provide you that you complete and your parents can sign. It's very simple.
I believe that regardless of the amount, a gift of money is not taxable.
Sweetie2004
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Re: Downpayment gift?
Would each parent have to complete a different gift letter in order to avoid the gift tax?
