My brother is building a house and wants to deposit money in my account for his building expenses, will this affect my taxes at all

Forum|Forum|4 years ago
April 26, 2022
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DoninGA

Employee

No. Deposits in your personal bank account are not reported on a tax return. However, if the account pays you interest the interest paid to you has to be reported as income on a tax return.

Anyone can open a bank account, so why does he need your bank account to deposit the money for the expenses? This almost sounds like money laundering.

Opus 17

Employee

If your brother is doing something improper (like hiding money from an ex-spouse, or working under the table, or making money from shady deals) you could find that all the funds in the account get confiscated, not just what was deposited by him.

leeloo

If he is giving you a gift of more than $15,000, he must file a gift tax retrun, Form 709.

Opus 17

Employee

@leeloo wrote:

If he is giving you a gift of more than $15,000, he must file a gift tax retrun, Form 709.

This is not a gift situation. Just because the money is parked in the brother's bank account, doesn't mean it is the brother's money. It would only be a gift if the brother receiving the money was free to spend the money without regard to the interests of the brother sending the money. (Similar to, if brother A parked his car at the home of brother B and give brother B the car, the car does not belong to brother B just because of where it is parked. The car does not belong to brother B unless there is an explicit transfer of ownership rights.)

However, if brother A deposits money in brother B's account that muddies things up and can lead to various kinds of bad outcomes, so it's not recommended to do this.