My bro won a $6ml taxed settlement & he wants to divide $1m between mom & mom in law will they have to pay tax

Question

My bro won a $6ml taxed settlement & he wants to divide $1m between mom & mom in law will they have to pay tax

Answer 1

Any amount that your brother gives is gift. He will have to file gift tax return.

Gifts up to $1 million -- is life time exclusion.

Read: Read http://taxipay.blogspot.com/2008/03/us-g...

Answer 2

No, they won't have to pay tax.  The people receiving a gift aren't taxed.  But your brother might have to pay income tax on part or all of the settlement, and will have to file a gift tax return for the gifts but might not have to pay any gift tax.

Answer 3

yes indeed they will the max tax free gift is aboout 11,000

Answer 4

To the extent it is taxable, it all taxable to your brother who earned it.  If he wants to give some away, he may have to pay gift tax.

Answer 5

With $6mil, I would suggest that you get a good accountant.  They will know all the tax laws!

Answer 6

Yes, unless he structures this as a corporation or trust. Your brother needs a tax attorney, and with $6 million he can afford it.