Would I be taxed on money gift from abroad? Consider the amount is larger than 100k. If yes, what is the rate? If no, do I still have to file some particular tax form on it as well?
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2 Answers
The US gift tax is to be paid by the giftor, not the recipient. So you should not be taxed for that gift in any way.
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It's an interesting question, I wonder how the US authorities would "deal with that" ?– FattieDec 10, 2018 at 13:55
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@Fattie As the giftor is NOT US Tax resident; the rules don't apply to the giftor. So if you are thinking IRS would chase a Non Resident, it is not the case.– DheerDec 11, 2018 at 9:45
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You're sure? It's commonplace that the IRS declares a person/entity "US connected".– FattieDec 11, 2018 at 10:47
It turns out that you must report it.
"The IRS requires U.S. taxpayers to file Form 3520..."
Unsurprisingly there are a number of "traps" ..
"For example, foreign family members should not make “gifts” to their U.S. family members from a foreign corporation, since the IRS will consider such transfers to be taxable corporate dividends that cannot qualify as tax-free gifts."
https://www.fool.com/knowledge-center/the-tax-law-on-foreign-cash-gifts.aspx
"However, separate IRS regulations require recipients to report a foreign cash gift. IRS Form 3520 is required if you receive more than $100,000 from a nonresident alien or a foreign estate. In addition, gifts from foreign corporations or partnerships are subject to a lower threshold that is adjusted for inflation each year. For 2016, gifts of more than $15,671 trigger the filing requirement. You won't owe any tax as a result of filing these documents. However, failing to file them can result in IRS penalties."
You can google many entries on this.
