Need advice. Aunt want to give me $20k to hold for her.

andy

I need some advice here, and if anything that knows anything about how our IRS tax stuff please reply.

Ok. My aunt has about $20k in her savings account. Because of something that I cant disclose here she needs give it to me to hold in the bank for about a year or so because I am the only one that she trust. Now I am 24 years old, still going to school, working full-time and have a house under my name that I am still paying off. I make about $35-40k a year and have about $2k in my own savings account.

Really I dont mind holding the money for her in the bank because I love her and she needs my help. The only thing that I am worried about is that at the end of the year when it comes to doing tax, I will have to let the IRS know about it. I dont really know how the IRS do the tax stuff all I know is that I get about $2k a year for refund.

Now since I am adding $20k in my savings account will they audit me and I will have to pay tax? I know there could be a lot of variables that could take place to determind the outcome, but would this be enough to change how the IRS will give me my tax.

Dont give me that BS on saying that I should take the money and spend it on my own. I dont know about you guys but that is jacked up and I will never do that to someone that I love.

.You can claim up to a certain amount as a gift and not have to pay taxes, odds are they wouldn't know about the 20k just the intrest paid on it by the bank. What you do need to think about is the reason you are being asked to hold on to this money, it may very well be illegal depending on the situation. I would rather have the IRS find out about the money than get charged with obstuction of justice or some other crime as a result of this.

disclaimer- I am not insinuating that you or your aunt are up to anything but when someone needs to quot;hidequot; money with someone else it raises a red flag.

.You'll only pay taxes on the interest you make.  So the IRS won't take anything more that.  

Also, any single transaction over $10k will get flagged by the bank.  So make it 3-4 separate transactions when she transfers the money to you.

Someone jump in if I'm incorrect here.

.Its not illegal, its just something that I rather not say on the board.

.Well the only thing I would worry about is that if she is getting rid of money as in filing for bankruptcy or otherwise hiding money that legally she should pay.  You are subject to that illegal thing.  Obviously you can just claim that she gave you the money...but when you give it back..you're toast.

You can claim $11000 (I think that's close to the new value)  as tax-free gifting.  In normal situations-  in years past the IRS wouldn't catch a 20K transfer, but in today's environment, they might.

.
Originally Posted by adc100

filing for bankruptcy or otherwise hiding money that legally she should pay.

first thoughts were bankruptcy.

.Like it was said above, just make 3-4 deposits.  The IRS will not know about any $ on your account, and you will only pay taxes on INTEREST above $600, IF you decide to include (the interest) in your taxes.

I brought MUCH-MUCH more than that amount in the US  (bank transfers) from Greece (Some of it was by brothers').  I never included it in my taxes.

.only problem with doing it isn't that they will immediately know, but if you do get pulled up for audits in the next 5 yrs or so.. it'll stick out a bit

.why not open a seperate account and have it locked? or is that something that isn't possible. or put it into a bond or CD at the bank. so u get more interest off the money and it can't be touched for a certain amount of time?

.
Originally Posted by Scratch705why not open a seperate account and have it locked? or is that something that isn't possible. or put it into a bond or CD at the bank. so u get more interest off the money and it can't be touched for a certain amount of time?

I don't think this speaks to the issue.  I have no idea what a quot;lockedquot; account is.

.Have her loan it to you and put it in a 12 month CD.  Have her charge you interest on the loan, at the same rate that the CD will return to you.  

/tax accountant

.Put it in as smaller deposits under 10k so up to 9999. and put it in a seprate no intrest account... thats all you have to do. nothing more nothing less.

.1. tell her youll have to pay taxes on it.

2. pay taxes on it.

3. done.

.the easiest way is to buy a safedeposit box and put her 20k in cash in there and have her pay you for the box each month

.I dont care about making money from it and she has nothing to hide from the gov. it is more a personal thing with other family members that she is hiding. That is as much as I can say about her problem.

You guys bring up a good point though, I wont put all 20K at once. 20k is a lot of money, I just dont want to owe tax at the end of the year.