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deadeadeadeadea OP t1_j2babxq wrote

Reply to comment by penguinise in Is a gifted check trackable? by deadeadeadeadea

Thank you. The money is already in my husband’s account. His family is just telling us that the money is trackable by the irs and that it can only be used at a school for tuition

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penguinise t1_j2bgxr1 wrote

If the check was deposited into an individual account in his name (not an exempt trust like an IRA, Section 529 account, etc.) then it is his money, free and clear, and is indistinguishable for tax purposes from any other money he may have.

Any tax consequences that may or may not have been due the grandfather for giving his grandson that money were incurred when the check went into an ordinary account, and in that year.

Any plausible tax issue would derive from whether he spent that amount on education in that year. It's moot now.

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