QUESTION
Is a US resident subject to gift tax when holding a joint account with a foreigner and gifts are made out of that joint account?
Asked on Jan 10th, 2016 on Taxation - California
More details to this question:
US resident holds a joint account with an foreigner Money is received from foreigner to a US resident US resident wants to send this money to another US person. Will the US person be subject to gift tax?
1 ANSWER
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When the US person deposits money in the joint bank account, there is no gift. However, when the foreign person withdraws money from that joint account, then there is a completed gift. The US person can give up to $14,000 a year to the foreign person. If the US person gives more than that, then the US person will be required to file a gift tax return, but a gift tax will not be owed until the US person exhausts his $5.45M lifetime exclusion.
Answered on Jan 23rd, 2016 at 9:48 PM