Receiving lasrge sums of money in US from family members in Paksitan

jefkorn

Registered Users (C)
#1
Receiving large (over 10k under 100k) sums of money in US from family members in Paksitan

Say parents or family members sell house or property and loan/gift money to their adult children in US to buy house in US or pay off cosumer loans, what are the things to be aware in the post 9/11 world.

Amount could over US $10k. Is wire transfer a safe option?

Any reporting requirements for tax purposes?

Need some guidance on this subject, would appreciate if you could share your experiences in this regard. Thank you
 
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StonedAnt

Registered Users (C)
#2
I don't know a whole lot about this except that wire transfer should be quite safe, you will have to provide your family with your bank account and routing number. The only trade off is that the bank sending the money will charge some fees/commission and the bank receiving the money (your bank) may charge some too. You may want to talk to your local Western Union branch as well to ask if such a large amount can be sent through them. For the taxation question, I believe if the money is somehow considered "income" then you may be liable for taxes on it but better to talk to an accountant for that as I do not know the rules.


Regards, SA.
 

jefkorn

Registered Users (C)
#3
I'm familiar with wire transfer as well as Monegram and western union types. The amount received becoming part of "income" is what my concern is. I want to make sure that it's reported properly if it needs to be reported to IRS.

Not a question directly for you and may be this forum is not for that but here goes: what happens if a USC received property as part of his inheritance overseas?

If anyone can point me to internataional taxation (read: desi, India, Pak) forum lik the the forum we are on, it will be very helpful. I'm sure this is not a uncommon issue.
 

insubuy

Registered Users (C)
#4
The sale of the property will have tax consequences in the country where it is sold. Most likely, there will be income tax on long term capital gain. The chartered accountant of that country can count the exact amount of tax based on property papers, sale value etc.

Once the tax has been paid, that money can be repatriated to the U.S. bank, in the same person's account or gifted as another person's bank account in the U.S. In India, there are a couple of forms to be filled with the help of CA before repatriation of Rupees into USD is allowed.

The beneficiary will not have any tax consequences and will not have to report to the IRS.

I am writing this from a layman knowledge and is not meant to be any kind of legal or accounting advice.
 

jefkorn

Registered Users (C)
#5
For the folks who may be in similar situation, here's something useful:

An attorney specializing in taxes for US citizen abroad answers a question similar to the one I'm asking here.

http://www.justanswer.com/tax/2hy1u-received-international-wire-transfer-from-philippines.html

"No, you do not owe any taxes on this money. There is no inheritance tax in the US and there is also no gift tax imposed on the recipient of a gift.

Since the amount you received was less than $100,000, then you are not even required to report receiving the money.

Keep in mind for future reference that if you ever receive money from a foreign source of more than $100,000 in any one year, you must report receipt of that money by filing Form 3520. No tax is due with the form, but it would be a reporting requirement on foreign transfers of more than $100,000 USD. "
 
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