Funds Transfer Help

[mr.round]

Hello All,

Newbie to this site and am hoping to get info for a situation.

To begin, I am saving money for a down payment on my first home. It is currently sitting in an online savings account. Now, my mom has run into some hardships and need money to pay her debts. She needs $26,000.

When, I am in need of extra money, I just electronically transfer money from my online account to my checking account (separate institutions). I was planning on transferring the $26,000 to my checking account; and then write her a check for the same amount.

I don't want to raise any red flags with the banking institutions and IRS. I have heard about reporting withdrawals & deposits limits. So, this worries me of my original plan. Any ideas on the best way to handle my situation (from my online account to my checking account to mymother's checking account)? Feel free to ask for clarification or further info. Any and all advice/info will be appreciated.

Thanks,

[LuckyRobin]

You can always pay her bills directly. I pay some of my mother's bills directly.

[creditcardfree]

I personally don't think it is an issue. You are simply moving your money to the account which allows you to write a check. It may seem like a large amount, and it is, but banks see large amounts of money move around all the time. You could always call your bank and talk to them about it. They would let you know if they needed some sort of documentation.

[frugalgirl]

There is a limit on how much one person can give another person without any taxes being owed. The amount is around $13,000 per year (I'm sure someone else will be along who knows the exact amount for 2011). If you are married, your wife can also give that amount to your mother doubling the amount that you can give to her.

[jpg7n16]

Originally Posted by frugalgirl

There is a limit on how much one person can give another person without any taxes being owed. The amount is around $13,000 per year (I'm sure someone else will be along who knows the exact amount for 2011). If you are married, your wife can also give that amount to your mother doubling the amount that you can give to her.

This is true, but you also have a $1 million lifetime exemption that you can use if the gift is over $13k. I doubt you'd owe any gift tax at all on the gift - though you would have to file a gift tax form if you're single, or if married and it's slightly over $26k.


Though I do kinda wonder, how is your mom's financial position? If she doesn't have $26k for debts, how does she have enough to retire on? Are you planning on supporting her?

I'm sorry if something just happened where she got $26k of say medical bills overnight - but typically, $26k of debt signals a slow build up of debt by living beyond your means. If this is debt that's 'built up over the years' she didn't just run into hardships.

[jeffery12]

you should be able to pay your moms bill directly