Set type in the Gift Affidavit effortlessly

Aug 6th, 2022
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How to Set type in the Gift Affidavit

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hey there youtube so in this video i wanted to cover how do gift taxes work in the united states theres a lot of misconceptions around gift taxes a lot of people think that the donor is the person that does it maybe the recipient has to worry about it so if you get gifted property from your friend or your aunt or your uncle uh youve got to be responsible for taking the tax out and paying it to the irs a lot of bad advice out there so what im going to try to do here is give some simple examples and cover the rules ive got a slide here in front of us and then ive got a form 709 an actual gift tax return another very simple one that well go through just to illustrate the main points here so first point to remember is the donor of the gift is the one thats responsible for reporting the gift if applicable and paying any gift taxes okay its not the recipient so donor is the one thats gifting the property and the donee is the person thats receiving it okay theyre the one thats re

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What is a Gift Affidavit? A Gift Affidavit is a sworn statement that can be used to document the gifting of property. If youve received or given a gift, you might have to prove it wasnt a loan or financial transaction with a Gift Affidavit.
When you apply for a mortgage, lenders need to know the money you use for your down payment is yours, and not an undisclosed loan. Youll need to get a gift letter from the person who gives you money. A gift letter assures your lender that the sudden influx of cash in your account is a gift and not a loan.
More In Forms and Instructions Use Form 709 to report: Transfers subject to the federal gift and certain generation-skipping transfer (GST) taxes.
How Do I Write a Gift Letter? The donors name, address and phone number. The donors relationship to the client. The dollar amount of the gift. The date when the funds were transferred. A statement from the donor that no repayment is expected. The donors signature. The address of the property being purchased, if known.
Its called a mortgage gift for a reason the gift giver is providing funds to a home buyer with no expectation of being repaid. If the buyer is planning to pay back the funds, that money was loaned not gifted, and then the lender is required to factor that into the debt-to-income ratio.
Stipulations of using gift money for your down payment When you use gift funds, you have to provide a gift letter that proves the funds are not a loan to be repaid. You may also be asked to provide documentation to prove the transfer of the gift into your bank account.
A mortgage gift letter must include: Donors name and contact information. Address of property being purchased. Donor and buyers relationship. Gift amount. Date of gift transfer. A statement that repayment isnt expected by the donor. Donors bank, account number, and type of account. Donors signature.
A mortgage gift letter that shows a gift of less than $16,000 might not be reported to the IRS. Thats because any gift below the $16,000 limit will not incur the gift tax. However, gift letters that involve a gift of more than $16,000 will likely be reported to the IRS.

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