Mixed Insurance Banners Health Insurance for Visitors to USA

Announcement

Collapse
No announcement yet.

Buying Home - Parents Sending Money. Any strings attached?

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

  • Buying Home - Parents Sending Money. Any strings attached?

    Planning to Buy Home in US and Parents Sending Money. Are there any strings attached?
    - Would there be any Tax for Parents in India or me after I get?
    - Any limit of amount?
    - Do we need to have any Gift letter or can think it as family maintenance( just like tuition fee during F1)

    Please suggest. Thanks

  • #2
    Since your parents are foreign persons from a US government standpoint, they can send as much money as they want. There is NO limit from the US side. However, you (recipient) has the following obligations:
    -- If the amount received by you is <=$99,999 per calendar year - Nothing extra to do
    -- If the amount is >=$100,000 per calendar year, you need to file IRS form 3520 to report this amount. There is NO tax to pay and this is for reporting only. So keep it under $99,000 to be on the extra safe side.

    - Your parents are liable for the transaction fees and tax (I think it is 2.5%) since the new rules kicked in on April 01, 2020. They can get this information from the foreign remittance department of the bank.
    - Your parents can send you a max of $250,000 (each) for the Indian fiscal year (April 01 - March 31).
    - They should contact their CPA is the amounts are high (just to make sure they are in compliance)

    After they are done sending you all the money, I would recommend they create a notarized document that clearly states the amounts sent, dates sent & purpose.
    The letter should contain their full legal names, age, indian address and that they are citizens of India only.
    The letter should contain your full legal name (as on passport), your passport#, current address & their relationship to you


    Opinion only. Cannot be construed as legal advice.

    Comment


    • #3
      Thanks for responding. That certainly helped in clearing my doubts.

      Loan Provider requesting for a gift letter, which contains, from where and to whom and how much is it, with sender's bank details. Would there be any problem in providing them?
      Also, Would I get any issue during filing tax returns next year?

      Comment

      Working...
      X