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Old 09-11-2014, 02:34 AM
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Gift tax issues on joint bank account ?

Six months ago, the bank told my sister it would be convenient to add her to our mother's account, so we did. Now we realize that this may trigger gift tax issues. The situation:

Mom finally sold her house last month, and would like to gift $75k to my sister and $75k to me. This is great, and we certainly plan to report these gifts (mom's assets will never approach the lifetime exclusion).

But -- is it OK to transfer the funds from her investment account (no check-writing capability) to the joint bank account, and then write the two checks ? Or does loading the funds to the joint account, then writing checks present the risk of some tax issue, complications, or challenges of my sister being self-serving ? (my sister & I are the only children)

Sorry for the detail, I'm just trying to be clear. A couple of forum posts seem to indicate that gift tax is only triggered on withdrawal of funds, not on deposit -- but we want to avoid any confusion or complications. Sometimes, things that are perfectly legal are worth avoiding just because they raise IRS red flags and set-off inquiries ...

THANK YOU !



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