Say you have a friend...?

Question

And your friend is wealthy and for whatever reason he decides to give you say 1 million dollars. Do you have to tell the police/government or pay taxes on that money?

P.S this doesn't apply to me or anyone i know. just came into my head

Answer 1

You can receive up to $10,000 a year, tax free from anybody. Once you cross that limit you have to pay a "gift" tax, even if the money comes from mom and dad.

I know, that sounds stupid but the greedy government somehow thinks they deserve a cut.

Answer 2

Yes you do have to pay taxes....I wouldn't tell....

Answer 3

you have to pay taxes on it. now it's only 1/2 a million.  

Answer 4

In Uk i should think yes, bcos its unearned income and eligible for tax. Personally i wouldnt tell them, i would save some and spend the rest, on holidays, a car, pay the mortgage off, etc. and keep schtum

Answer 5

Unless they gave you cash in a suitcase and the transaction somehow escaped the steely gaze of government tax authorities, you would indeed have to pay taxes on that generous gift.