Giving partial of proceeds from life insurance check to a sibling over $25K

Forum|Forum|2 years ago
March 16, 2024
1 reply
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I live in Maryland and just received a life insurance check due to my dad's passing and will be depositing the check in my bank account soon.

I would like to split the proceeds with my sibling. Would there be tax implications of issuing a cashier's check to my sibling of $25K+, even if it's from life insurance proceeds? If I do have to report this as a gift, is this form to report it available in the Turbo Tax Deluxe software when filing taxes? I usually e-file Federal and Maryland with the TurboTax Deluxe software, so I want to make sure that I won't have to do anything separately if it does have to be reported next year.

Best answer by xmasbaby0

Gifts given to family members, friends or other individuals are not deductible. Gifts received are not taxable to the person who received the gift, and are not entered on a tax return.

If your gift exceeds the yearly limit ($17,000 per individual) imposed by the gift tax rules, then you will need to complete a Form 709 gift tax form and send it to the IRS, although it is very unlikely that you will owe any tax. In 2024 that yearly limit will increase to $18,000.

TurboTax does not support Form 709. It is not an income tax form and would not be included as part of an income tax return.

Here is a link to the form:

https://www.irs.gov/pub/irs-pdf/f709.pdf

https://turbotax.intuit.com/tax-tips/estates/the-gift-tax-made-simple/L5tGWVC8N

xmasbaby0Answer

Employee

Gifts given to family members, friends or other individuals are not deductible. Gifts received are not taxable to the person who received the gift, and are not entered on a tax return.

TurboTax does not support Form 709. It is not an income tax form and would not be included as part of an income tax return.

Here is a link to the form:

https://www.irs.gov/pub/irs-pdf/f709.pdf

https://turbotax.intuit.com/tax-tips/estates/the-gift-tax-made-simple/L5tGWVC8N

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

DianeW777

The information provided by xmasbaby0 is correct. I would advise having a tax professional complete Form 709 for you. It's important to keep it in a safe place for many years to come as proof of your filing it.

@cunninar

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