My friends dad wants to send her $9k USD

[Scouzer]

Situation:

Her dad is working in California. He is a construction foreman. He does not have a Canadian bank account. I do not know if he's still a Canadian citizen or not, or what the situation is in that respect. She lives in Canada.

He has what he is describing as having 'too much money' which to me is a big red flag right away. He wants to send her $9k USD next week to her bank account, and possibly more later. He claims that sums less than $10k are not taxable.

My immediate suspicion is tax evasion...she's going to school so she's in a very low tax bracket....but I can't see any good coming of this.

Does anyone know the laws regarding cross border money shifting? This seems like such a bad idea...

And by the way, I'm not prying into her business, she's asking me about this...

 

[MichaelD]

AFAIK, into/out of the USA territories, the limit is $10K per transaction.

Though I may not know the rules exactly, I know a cheat when I see one. He's not being generous and giving his daughter money; he's got every intention of getting back ALL of it, to the penny, once tax time has passed. I hope he gets caught.

 

[Scouzer]

Well, now she has it. It ended up being $9200 CAD.

Now what? I assume she'll have to pay Canadian taxes on it...

 

[sygyzy]

What are you looking for? You want us to tell you Canadian tax laws?

 

[Scouzer]

Originally posted by: sygyzy
What are you looking for? You want us to tell you Canadian tax laws?

/shrug

Would be nice, but just thoughts on it are all that's really expected.

 

[RelaxTheMind]

hmm... I have a US bank account he can use.

 

[DaWhim]

is her dad gonna pay taxes on those money?

tax evasion is illegal.

 

[Captante]

I believe US Tax law allows a parent to give a family member up to $11k without paying taxs on it, however $10k is the amount that if exceeded must be reported to the IRS so it does sound suspicious the way he's doing this.

 

[Aquaman]

She will not have to pay taxes......... her dad gave her the money. It's a gift....... so no taxes

ps. some banks will report $5000 transfers (that is for the gov't to look for illegal traffic (ie drug money, terrorist money))

Cheers,
Aquaman

 

[Scouzer]

Originally posted by: Aquaman
She will not have to pay taxes......... her dad gave her the money. It's a gift....... so no taxes

ps. some banks will report $5000 transfers (that is for the gov't to look for illegal traffic (ie drug money, terrorist money))

Cheers,
Aquaman

Really? That's surprising. I had no idea gifts could be that large tax free!

 

[Parasitic]

Maybe her dad is giving her that much money for college?
I mean maybe it's to support her for her school year?

 

[JS80]

you fail at tax law

 

[Kur]

USPS Money Order, just get 9 $1000 ones!

 

[JS80]

i say fedex cash overnight

 

[TheGizmo]

Originally posted by: JS80
i say fedex cash overnight

i heard a guy on these forums say the mailed somewhere just over 10 grand fedex overnight and it got there box not damaged, but the money was gone

 

[mugs]

Originally posted by: Captante
I believe US Tax law allows a parent to give a family member up to $11k without paying taxs on it, however $10k is the amount that if exceeded must be reported to the IRS so it does sound suspicious the way he's doing this.

$11k to anyone, and that's an annual limit, not a one-time limit. But then you have the lifetime $1 million threshold you have to hit before you have to pay any gift tax... it's all kind of confusing.

I think the $10k limit before the transaction must be reported to the IRS is what he's trying to avoid, but I'm pretty sure that only applies to cash transactions... the guy could be confused though.

Giving money to his daughter wouldn't help the guy avoid any taxes... it's not like he can write it off. Given that he's a construction foreman, if there is anything shady going on I'd guess that the money is from illicit activities and he's trying to hide it.

 

[JS80]

Originally posted by: TheGizmo

Originally posted by: JS80
i say fedex cash overnight

i heard a guy on these forums say the mailed somewhere just over 10 grand fedex overnight and it got there box not damaged, but the money was gone

lol cereal?

 

[Oakenfold]

Originally posted by: mugs

Originally posted by: Captante
I believe US Tax law allows a parent to give a family member up to $11k without paying taxs on it, however $10k is the amount that if exceeded must be reported to the IRS so it does sound suspicious the way he's doing this.

I think the $10k limit before the transaction must be reported to the IRS is what he's trying to avoid, but I'm pretty sure that only applies to cash transactions... the guy could be confused though.

I'm not certain of the IRS limits however they are not the only government agency that is interested in how you move money around, and it does sound very suspicious.
Just an FYI for the poster.

Currency Transaction Report - $10k
-Typically applies to cash or monetary instruments.
Bank Secrecy Act and Suspicious Activity Reporting - 5K
-Could apply here if someone is attempting to "hide funds from illegal activity". Basically Fincen wants to know about suspicious stuff if it's assets of at least 5K.

 

[Alprazolam]

This brings me back to when I paid for my Yellow Special Edition Viper over 95k in cash... Heh

 

[Aquaman]

Originally posted by: Scouzer

Originally posted by: Aquaman
She will not have to pay taxes......... her dad gave her the money. It's a gift....... so no taxes

ps. some banks will report $5000 transfers (that is for the gov't to look for illegal traffic (ie drug money, terrorist money))

Cheers,
Aquaman

Really? That's surprising. I had no idea gifts could be that large tax free!

He is still responsible for paying any taxes on that money. Be it US or Canadian taxes (probably US since he earned it there).

Heck I was given a propertiy by my parents...... no tax implications (my parents bought a new Principle residence and gave me the old house). My sisters were given a good chunk of money....... no taxes to them since it was a gift (and my parents already paid taxes on it).

Cheers,
Aquaman

 

[mrrman]

cant he just do a wire transfer...you cant carry more than $10k on you if you cross the border or you have to claim it