Taxes on someone else paying my mortgage
I have to repay my house loan. Can I take money from my son for repaying the loan?
The bank is saying that my son cannot pay directly from his account;
it means I have to receive money in my account from his account and then repay the loan from my account.
What are the tax implications on my son and on me for the transaction of transferring money by him into my account? I do not maintain books of accounts as I am salaried person.
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Are you planning on paying your son back? If so, this is a loan from him. If not, it is a gift. Both have possible and different tax implications. For example, gifts above ,000 (,000 if your son is married) per calendar year may be subject to a gift tax. If it is a loan, the IRS has rules about the interest rate you must pay him and taxes get more complicated if it is too low (or zero).
Edit: Notice that if you are also married, I believe your son and his wife can give k each to each of you and your spouse. If the house is in her name as well you may be able to pay as much as K without the gift tax. Notice that this is a yearly amount, so if this was December you could get k in December and K in January.
Your son is completely free to pay off your mortgage if he wants. However in most jurisdictions it counts as a gift to you, and will be subject to gift tax, or its equivalent. This is why the bank doesn't want to receive payments directly from your son, so that they are not caught up in the reporting of this.
If you are in the US, this is a good page about Gift Tax.
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