Me and my wife received a wrongful death settlement and we gifted out about one million dollars of it to family and friends.

Asked over 1 year ago - Traverse City, MI

Are we liable to pay taxes on gifted money.

Attorney answers (6)

  1. George Costas Andriotis

    Contributor Level 20

    16

    Lawyers agree

    Answered . A tax attorney or CPA is in the best position to answer this question. Factors to consider are each amount given, to whom they were given and over what time frame I.e. lump sum.

    Call for a free consultation at 727-937-1400 or visit us on the Web at www.serviceandjustice.com.
  2. Robert Bruce Kopelson

    Contributor Level 20

    15

    Lawyers agree

    Answered . This is a question for a tax atty, estate planning atty, or CPA. You need to talk to someone in your state familiar with both state and federal laws on this. Usually it depends upon how much you give in any specific year, what relation the person is, and whether it is to apply against the estate exemption applicable to inheritance taxes.

  3. Sagi Shaked

    Pro

    Contributor Level 13

    12

    Lawyers agree

    Answered . Speak to your CPA. This question is outside the scope for a personal Injutry attorney.

  4. Brian Joseph Munson

    Contributor Level 13

    10

    Lawyers agree

    Answered . The gift taxable. However, you and your wife each have a $5 Million exclusion over your lifetime. As long as you do not exceed that, you will not owe any tax.

    This answer does not establish an attorney-client relationship, Moreover, this attorney is Licensed to practiced... more
  5. David Thomas Dorer

    Contributor Level 12

    7

    Lawyers agree

    Answered . Generally, those receiving the gifts are liable. The giftee must claim it as ascension to wealth (gross income), and the giftor doesn't do anything.

    The settlement receivors are liable for their ascension to wealth ($1m) under normal income rules and the family/friends are liable under gift rules (there are particular rules for children/grandchildren).

    Consult a tax/estate planning attorney or CPA, though. Tax is a uniquely complicated field.

    Answers to questions does not create an attorney/client relationship. I only am your attorney if I have entered... more
  6. John W. Drury

    Contributor Level 10

    2

    Lawyers agree

    Answered . You and your wife each have an annual gift allowance of, $13,000.00 to anyone and as many as you choose. You really should hire a CPA or tax attorney for more details.

    So there is no misunderstanding, this answer does not create an attorney/client relationship and you cannot... more

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