Skip to comments.Edwards, feds arguing if money was donated or gift
Posted on 05/31/2011 3:02:27 PM PDT by CharlyFord
WASHINGTON (AP) -- Former presidential candidate John Edwards and federal prosecutors are arguing over whether funds used to cover up his extramarital affair were campaign contributions or just gifts from his longtime friends.
(Excerpt) Read more at hosted.ap.org ...
Clinton can't understand the word "is"!
Barney Frank can't understand the word "pervert"!
Dimocrats sure are dumb!
Edwards had millions of dollars in the bank and he owned a brand 29,000 Sq ft home and his friends insisted on giving him cash “gifts.” Yeah that’s it, it’s a good story.
I could sure use similar friends.
well, how did he claim it on his tax returns?
Did he claim it as gifts and pay taxes on it?
Gifts are generally excluded from gross income under Section 102.
And it pays to have foreign friends - they can ‘gift’ up to $100k/year with no IRS form required. US friends, however, are limited to a paltry $13k/year.
GREAT question!!!! Did he claim it as a GIFT to the IRS!!!!
Didn’t Bunny Mellon give him over $500,000.00????? THAT”S SOME gift!!!
If I understand the gift tax, Bunny Mellon owes the gift tax on the money she gave to the Silky Pony. Wonder if she paid it?
The recipient of a gift is not responsible for reporting the gift to the IRS. Gifts are generally not subject to income tax. A gift from an employer is subject to income tax regardless of donative intent (Sec. 102(c)). Donors are responsible for filing gift tax returns (Form 709). The gift tax is an excise tax on the gift of property. No gift tax return is required if the gift is under the annual exclusion amount, which is currently $13,000 per donor per donee (it is $10,000 as indexed for inflation). A gift tax return is required if the amount exceeds the annual exclusion. Before the donor has to pay any gift tax, the donor must have exhausted the lifetime exclusion, which I believe is currently $1,000,000. Married individuals can effectively double the annual exclusion and lifetime exemption by electing gift splitting on Form 709.
That is a relevant question. If the money were a gift and exceeded $13,000, the donor should have filed a gift tax return (Form 709). Of course, it is not the recipient’s fault if the donor failed to file the gift tax return. However, if the donor had exhausted the lifetime exemption so that the donor should have paid a gift tax, then the unpaid gift tax becomes a lien on the gift received by the donee. Under the doctrine of transferee liability, the IRS could then seek to collect the unpaid gift tax from the donee.
Gifts from foreigners are indeed subject to different rules that can be rather complex.