Receiving a gift from parents across the border

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fred2028
Posts: 3
Joined: Sat Oct 14, 2017 5:28 pm

Receiving a gift from parents across the border

Post by fred2028 »

I currently live and work in the US on a TN status and my parents are in Canada. We are all Canadian citizens. Are there any taxes or limits on the amount of cash my parents can gift me?

I looked online, seems Canada has no gift tax. The IRS website is a bit more cryptic, but it seems to suggest there is only a $14k/person gift tax for donors who are living in the US. So this seems to suggest there is no limit on the amount of cash my parents can gift me without tax?

Thoroughly confused but welcoming input, thanks!
fred2028
Posts: 3
Joined: Sat Oct 14, 2017 5:28 pm

Re: Receiving a gift from parents across the border

Post by fred2028 »

[quote="fred2028"]I currently live and work in the US on a TN status and my parents are in Canada. We are all Canadian citizens. Are there any taxes or limits on the amount of cash my parents can gift me?

I looked online, seems Canada has no gift tax. The IRS website is a bit more cryptic, but it seems to suggest there is only a $14k/person gift tax for donors who are living in the US. So this seems to suggest there is no limit on the amount of cash my parents can gift me without tax?

Thoroughly confused but welcoming input, thanks![/quote]
By $14k/person I mean that as the tax-exempt gift limit
mdmorris
Posts: 4
Joined: Tue Sep 26, 2017 8:10 pm

Post by mdmorris »

On the USA side, Form 3520 to report foreign gifts over 100k received from a nonresident individual. If you bring it over the border on your person (not wire transfer) and it is over 10k then you need Fincen 105 for the CBP. I think thats it.

Side note about the 14k. This is the basic annual exclusion limit for gifts donated by US taxpayers to anywhere (USA or foreign). On top of this there is ~$5M lifetime exclusion limit (combined for gifts and estate bequests), which you use only after going over 14k in a year. So you or your estate would only pay gift and/or estate tax if you eventually donated or bequeathed a total of more than 5M. Hence the gift tax is reserved mostly for the very wealthy.

And all of this is only for the donor (and they file Form 709 if they go over the 14k).
fred2028
Posts: 3
Joined: Sat Oct 14, 2017 5:28 pm

Post by fred2028 »

[quote="mdmorris"]On the USA side, Form 3520 to report foreign gifts over 100k received from a nonresident individual. If you bring it over the border on your person (not wire transfer) and it is over 10k then you need Fincen 105 for the CBP. I think thats it.

Side note about the 14k. This is the basic annual exclusion limit for gifts donated by US taxpayers to anywhere (USA or foreign). On top of this there is ~$5M lifetime exclusion limit (combined for gifts and estate bequests), which you use only after going over 14k in a year. So you or your estate would only pay gift and/or estate tax if you eventually donated or bequeathed a total of more than 5M. Hence the gift tax is reserved mostly for the very wealthy.

And all of this is only for the donor (and they file Form 709 if they go over the 14k).[/quote]
Thanks. And to confirm, Canada has no taxes or documentation required of the donor, right?

https://turbotax.intuit.ca/tips/tax-tip ... anada-5081
mdmorris
Posts: 4
Joined: Tue Sep 26, 2017 8:10 pm

Post by mdmorris »

If you export it as cash or monetary instrument while traveling or by sending it through the mail, the Canadian CBSA has a similar rule to the US CBP (over 10k must be reported [url]http://www.cbsa-asfc.gc.ca/publications ... 7-eng.html[/url]). My understanding is that it is not required for a bank transfer (the bank will report). Not sure if there is anything else.
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