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Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??

 
Magnison

User ID: 80105326
07/30/2022 11:00 AM
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Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
Hi folks... I have a friend I want to help out. He only owes 50k on his house and its on an adjustable Line of Credit.

My thoughts were to pay off that loan for him in exchange for a 50K lean against his property, which he would then make small payments to me at a very low interest rate.

My intent is to give this free and clear in some way, but in a legal manner where he wouldn't have to pay a tax on the money.

I'm wondering if I simply pay off the loan with the stipulation that I receive a payback when the house is sold in the future, if that would suffice in him 'trading' 50k in cash for me holding 50K against his property.

If there are other ways to do this in a legally then please offer your comments.

Thanks!

BTW, I would call my CPA about it but he charges 250.00 an hour and I don't really want to go that route right now if I can find some info here or elsewhere.
Anonymous Coward
User ID: 50423416
United Kingdom
07/30/2022 11:02 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
you're worried about not paying tax but fail to see lending money is illegal without a licence.
R
User ID: 79009989
United States
07/30/2022 11:08 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
Yes, someone does.
JFN111

User ID: 80922148
United States
07/30/2022 11:11 AM

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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
There is no gift tax that a recipient pays. The giver has to fill out a form for any gift over $16,000 ($32,000 if your friend is married).
The excess contribution is counted against your estate, after you die, if the estate is worth more than $12 million dollars.
Anonymous Coward
User ID: 50423416
United Kingdom
07/30/2022 11:12 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
15k per year.


no expceptions.
Anonymous Coward
User ID: 83133948
United States
07/30/2022 11:13 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
You're willing to give a friend $50k but scoff at paying a CPA $250/hour for sound advice?
Anonymous Coward
User ID: 79781903
United States
07/30/2022 11:14 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
Open a joint bank account with the other person
Magnison  (OP)

User ID: 80105326
07/30/2022 11:14 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
You're willing to give a friend $50k but scoff at paying a CPA $250/hour for sound advice?
 Quoting: Anonymous Coward 83133948


Thus the reason I have 50K extra to help someone.
Stormborn

User ID: 72585127
United States
07/30/2022 11:15 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
You're willing to give a friend $50k but scoff at paying a CPA $250/hour for sound advice?
 Quoting: Anonymous Coward 83133948


That is the mindset that put him in the position to be able to lend 50k in the first place. I understand it.
“Timid men prefer the calm of despotism to the tempestuous sea of liberty.” -Jefferson
Magnison  (OP)

User ID: 80105326
07/30/2022 11:17 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
There is no gift tax that a recipient pays. The giver has to fill out a form for any gift over $16,000 ($32,000 if your friend is married).
The excess contribution is counted against your estate, after you die, if the estate is worth more than $12 million dollars.
 Quoting: JFN111


Hi. Thanks for the reply. Can you help me know how to search specifically for this online? I've not heard of this scenario but if accurate would be fine with me.
Anonymous Coward
User ID: 81003523
Canada
07/30/2022 11:20 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
I had money.
I had a friend.
I lent my friend my money.
Now I have neither friend nor money.
Doc McBaffled

User ID: 81674768
Canada
07/30/2022 11:20 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
Buy 2 bitcoin, send them to your friend.
Everything you teach you are learning. Teach only love and learn that love is yours and you are love.
-ACIM.
Anonymous Coward
User ID: 81003523
Canada
07/30/2022 11:22 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
I had money.
I had a friend.
I lent my friend my money.
Now I have neither friend nor money.
 Quoting: Anonymous Coward 81003523


Or just pay it, wait for a relative to die, could have even been a while ago... if it comes up, it is inheritance.

Unless he makes more the 250 k.... it won't come up 98%
Anonymous Coward
User ID: 83810396
United States
07/30/2022 11:22 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
Place cash inside a newspaper, place at his front door? That’s how the Alumni used to give non pro athletes gifts in college..... /shrug

Pretty sure no one ever paid taxes on it.
Anonymous Coward
User ID: 83133948
United States
07/30/2022 11:24 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
You're willing to give a friend $50k but scoff at paying a CPA $250/hour for sound advice?
 Quoting: Anonymous Coward 83133948


That is the mindset that put him in the position to be able to lend 50k in the first place. I understand it.
 Quoting: Stormborn


So, you're saying that the truly wealthy refuse to pay for the best accountants and tax attorneys money can buy? There's times to pinch pennies, but I don't think that time is when you're trying to lower your tax liability to the IRS.
Anonymous Coward
User ID: 83937132
United States
07/30/2022 11:27 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
Open a checking account with both your names on it. Let him draw from it.
Magnison  (OP)

User ID: 80105326
07/30/2022 11:29 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
You're willing to give a friend $50k but scoff at paying a CPA $250/hour for sound advice?
 Quoting: Anonymous Coward 83133948


That is the mindset that put him in the position to be able to lend 50k in the first place. I understand it.
 Quoting: Stormborn


So, you're saying that the truly wealthy refuse to pay for the best accountants and tax attorneys money can buy? There's times to pinch pennies, but I don't think that time is when you're trying to lower your tax liability to the IRS.
 Quoting: Anonymous Coward 83133948


Depends on what you call 'truly wealthy'. I don't consider myself that, but any stretch.

But, I would rather find out for free, if possible the best direction to take, and give that 250.00 to someone else rather than pay it for a 15 minute conversation to a CPA that is 'truly wealthy'.

My first thoughts were just loaning him the money, in a legal and binding way, for an extremely long time, at an extremely low rate, so in essence it would feel like it was basically given to him.
Anonymous Coward
User ID: 78028954
United States
07/30/2022 11:30 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
Hi folks... I have a friend I want to help out. He only owes 50k on his house and its on an adjustable Line of Credit.

My thoughts were to pay off that loan for him in exchange for a 50K lean against his property, which he would then make small payments to me at a very low interest rate.

My intent is to give this free and clear in some way, but in a legal manner where he wouldn't have to pay a tax on the money.

I'm wondering if I simply pay off the loan with the stipulation that I receive a payback when the house is sold in the future, if that would suffice in him 'trading' 50k in cash for me holding 50K against his property.

If there are other ways to do this in a legally then please offer your comments.

Thanks!

BTW, I would call my CPA about it but he charges 250.00 an hour and I don't really want to go that route right now if I can find some info here or elsewhere.
 Quoting: Magnison


Have him deed the property to you by way of a quit claim deed. You then payoff the mortgage. Draft a promissory note with your terms, and interest charge, and when he pays it off you deed the property back to him free and clear.
Anonymous Coward
User ID: 78508241
United Kingdom
07/30/2022 11:32 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
Hi folks... I have a friend I want to help out. He only owes 50k on his house and its on an adjustable Line of Credit.

My thoughts were to pay off that loan for him in exchange for a 50K lean against his property, which he would then make small payments to me at a very low interest rate.

My intent is to give this free and clear in some way, but in a legal manner where he wouldn't have to pay a tax on the money.

I'm wondering if I simply pay off the loan with the stipulation that I receive a payback when the house is sold in the future, if that would suffice in him 'trading' 50k in cash for me holding 50K against his property.

If there are other ways to do this in a legally then please offer your comments.

Thanks!

BTW, I would call my CPA about it but he charges 250.00 an hour and I don't really want to go that route right now if I can find some info here or elsewhere.
 Quoting: Magnison


CRYPTO WALLETS.... WALLET TO WALLET TRANSFER USING XLM COIN.
EarthNotAPlanet

User ID: 39961547
United States
07/30/2022 11:32 AM

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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
Why not buy the house from him, and then as his landlord, provide a rent-to-own lease?
Mola Ram did nothing wrong.
Anonymous Coward
User ID: 78233404
United States
07/30/2022 11:35 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
Why not buy the house from him, and then as his landlord, provide a rent-to-own lease?
 Quoting: EarthNotAPlanet


This might be the most sound advice, how much equity over the 50k does he have in it?
Anonymous Coward
User ID: 81003523
Canada
07/30/2022 11:36 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
Have him paint a painting, buy it from him, donate painting to charity.
Anonymous Coward
User ID: 83133948
United States
07/30/2022 11:37 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
You're willing to give a friend $50k but scoff at paying a CPA $250/hour for sound advice?
 Quoting: Anonymous Coward 83133948


That is the mindset that put him in the position to be able to lend 50k in the first place. I understand it.
 Quoting: Stormborn


So, you're saying that the truly wealthy refuse to pay for the best accountants and tax attorneys money can buy? There's times to pinch pennies, but I don't think that time is when you're trying to lower your tax liability to the IRS.
 Quoting: Anonymous Coward 83133948


Depends on what you call 'truly wealthy'. I don't consider myself that, but any stretch.

But, I would rather find out for free, if possible the best direction to take, and give that 250.00 to someone else rather than pay it for a 15 minute conversation to a CPA that is 'truly wealthy'.

My first thoughts were just loaning him the money, in a legal and binding way, for an extremely long time, at an extremely low rate, so in essence it would feel like it was basically given to him.

 Quoting: Magnison


I hear you. I'm quite the penny pincher myself. I just feel that money allocated to lowering you tax liability is money well spent. The last thing I want is a surprise when I go to file my taxes because I took free advice from someone that may have given bad or outdated advice.
Anonymous
User ID: 78400023
United States
07/30/2022 11:38 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
I've heard that $9,000 is the limit for tax free gift
FeedYourHead

User ID: 77416429
United States
07/30/2022 11:38 AM

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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
Hi folks... I have a friend I want to help out. He only owes 50k on his house and its on an adjustable Line of Credit.

My thoughts were to pay off that loan for him in exchange for a 50K lean against his property, which he would then make small payments to me at a very low interest rate.

My intent is to give this free and clear in some way, but in a legal manner where he wouldn't have to pay a tax on the money.

I'm wondering if I simply pay off the loan with the stipulation that I receive a payback when the house is sold in the future, if that would suffice in him 'trading' 50k in cash for me holding 50K against his property.

If there are other ways to do this in a legally then please offer your comments.

Thanks!

BTW, I would call my CPA about it but he charges 250.00 an hour and I don't really want to go that route right now if I can find some info here or elsewhere.
 Quoting: Magnison


You aren't "giving" him anything other than a loan. You are simply replacing one loan with yours. There would be no "tax" in this situation as there is no gift..it's a dang loan. How can you not understand this?
Ask Alice when she's 10ft tall
Anonymous Coward
User ID: 83133948
United States
07/30/2022 11:39 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
I've heard that $9,000 is the limit for tax free gift
 Quoting: Anonymous 78400023


It used to be $10k per year. But that may have changed.
Anonymous Coward
User ID: 81003523
Canada
07/30/2022 11:41 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
Why not buy the house from him, and then as his landlord, provide a rent-to-own lease?
 Quoting: EarthNotAPlanet


Then all taxes, fines, fees, repairs, ect..any idea how much it costs to change ownership back and forth?
All expenses are OP

He is asking for good advise, not a lifetime of hell
Anonymous Coward
User ID: 81003523
Canada
07/30/2022 11:42 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
Why not buy the house from him, and then as his landlord, provide a rent-to-own lease?
 Quoting: EarthNotAPlanet


Then all taxes, fines, fees, repairs, ect..any idea how much it costs to change ownership back and forth?
All expenses are OP

He is asking for good advise, not a lifetime of hell
 Quoting: Anonymous Coward 81003523


Forgot to mention the TAX OP would have to pay for the rental income.
Anonymous Coward
User ID: 78028954
United States
07/30/2022 11:44 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
Why not buy the house from him, and then as his landlord, provide a rent-to-own lease?
 Quoting: EarthNotAPlanet


Exactly. It's a purchase subject to the mortgage. He takes the deed, pays the mortgage, then establishes a lease-purchase agreement for $50K. When paid his friend gets the deed back. His friend is motivated to pay off the note, and he is protected by holding the deed so if his friend defaults he gets the property. Any good real estate attorney can set it up legally.
Treefire

User ID: 83920665
United States
07/30/2022 11:49 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
Place cash inside a newspaper, place at his front door? That’s how the Alumni used to give non pro athletes gifts in college..... /shrug

Pretty sure no one ever paid taxes on it.
 Quoting: Anonymous Coward 83810396


hesright

So is the crypto transfer. So is the bank account.
Arbrefeu
Magnison  (OP)

User ID: 80105326
07/30/2022 11:52 AM
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Re: Does anyone know how to give 50,000.00 to a friend without them having to pay a gift tax??
Open a checking account with both your names on it. Let him draw from it.
 Quoting: Anonymous Coward 83937132


I have thought of that. Opening a checking account with a debit card and just giving him the debit card on that account to do with as he wishes.

But at some point, if he were to pay off a LOC for his house, he might have to explain how he did that if there were an audit of some sort.





GLP