Gifting from joint account

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Lee_WSP
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Re: Gifting from joint account

Post by Lee_WSP »

mptfan wrote: Sun Jul 25, 2021 8:33 pm
Lee_WSP wrote: Sun Jul 25, 2021 8:31 pm No. I practice in a community property state. Presumption of gifts to the community are par for the course.
So if I would have said that both owners of a joint account are each "presumed" to jointly own 100% of the funds in the account, you would have agreed?
Yes, that would be a correct statement of the common law. They jointly own an undivided interest in the property.

I think the bone of contention is how to deal with the fact that most institutions allow any joint tenant to withdraw all the funds. In which case it is unclear who owns what and what they are actually entitled to.


mptfan wrote: Sun Jul 25, 2021 8:42 pm [quote=Lee_WSP post_id=6139449 time=<a href="tel:1627263091">1627263091</a> user_id=147765]
Edit
It is also consistent with my earlier agreement with you that the contributions are owned jointly. But apparently the uniform law doesn't like that. But that's a different discussion.
You wrote this:

"Joint tenants share ownership. You cannot each own 100% of something, that add ups to 200%. You each own/are entitled to 1/n of the account."

I don't think that statement is consistent with agreeing that contributions to a joint account are owned jointly.
[/quote]

Joint ownership is 1/n of the tenancy. The tenancy is an undivided interest in the property.
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Lee_WSP
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Re: Gifting from joint account

Post by Lee_WSP »

Not exactly Black's law dictionary, but since it's behind paywalls, these will have to do

https://lawshelf.com/coursewarecontentv ... t-tenancy/

https://law.jrank.org/pages/7851/Joint-Tenancy.html

http://turnerpropertytwo.lawbooks.cali. ... ownership/

Edit
I was wrong, Black's is available online
https://thelawdictionary.org/article/di ... in-common/

Under the common law, a joint tenant is not allowed to unilaterally convey the property, but is allowed to unilaterally transfer his/her share of the tenancy, thereby breaking the four unities and converting the tenancy into a tenants in common ownership structure. The "straw man" conveyance was the workaround to the joint tenancy, but the modern approach allows the joint tenant to simply convey the interest to themselves and break the joint tenancy that way; although some states allow the rest of the joint tenants to continue their joint tenancy (if there are three tenants and one chooses to not continue as a joint tenant, the other two will continue as joint tenants as to their 2/3 interest the 3rd will be a tenant in common).
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JoeRetire
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Re: Gifting from joint account

Post by JoeRetire »

Lee_WSP wrote: Sun Jul 25, 2021 9:24 am Unlimited access is not ownership. But I didn't say ownership, I said tenancy. They have 1/n of the joint tenancy.
Thread title: Gifting from joint account.
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Lee_WSP
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Re: Gifting from joint account

Post by Lee_WSP »

JoeRetire wrote: Mon Jul 26, 2021 1:06 pm
Lee_WSP wrote: Sun Jul 25, 2021 9:24 am Unlimited access is not ownership. But I didn't say ownership, I said tenancy. They have 1/n of the joint tenancy.
Thread title: Gifting from joint account.
Joint account is a form of joint tenancy which is a form of ownership.
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JoeRetire
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Re: Gifting from joint account

Post by JoeRetire »

Lee_WSP wrote: Mon Jul 26, 2021 1:48 pm
JoeRetire wrote: Mon Jul 26, 2021 1:06 pm
Lee_WSP wrote: Sun Jul 25, 2021 9:24 am Unlimited access is not ownership. But I didn't say ownership, I said tenancy. They have 1/n of the joint tenancy.
Thread title: Gifting from joint account.
Joint account is a form of joint tenancy which is a form of ownership.
You say tenancy, I say potatoes.
You say each owner has 1/n of the joint tenancy, I say either party can choose to spend 100% of the account if they so choose.

Have a good day.
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Lee_WSP
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Re: Gifting from joint account

Post by Lee_WSP »

JoeRetire wrote: Mon Jul 26, 2021 1:51 pm I say either party can choose to spend 100% of the account if they so choose.
Yes, that would be the effect of each party having a right to possession of the whole property.
MarkNYC
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Re: Gifting from joint account

Post by MarkNYC »

Here is how the IRS views it:

Gift tax: If A fully funds a nonspousal joint bank account with B, that will not create a gift to B subject to gift tax. A gift to B will take place if and when B withdraws funds from the account for his own benefit.

Estate tax: When the first co-tenant of the account dies, the IRS will consider 100% of the account value to be includible in the decedent's gross estate unless the executor can show that a specific portion of the account was funded by the other co-tenant.
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gobel
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Re: Gifting from joint account

Post by gobel »

meh, the last 50 or so posts are kinda useless to the OP, who wasn't even asking if he can give away more than 1/2 of his joint account that he has with his brother.

His/Her original question was about gift splitting with their spouses, which I think IS allowed and is exactly what gift splitting was intended for: doubling the gift exclusion when a spouse gifts something from non-marital assets. Note, this still requires form 709 so it doesn't completely satisfy the requirements in the OP.

In this way, the two couples can give their mom the 8 or 900k in about 15 years without using up any of their lifetime limit. I wonder what the intent is - is it to save taxes or to pay bills? If the mom has high medical bills, the sons could actually just pay them directly without any concern for gift tax limits.
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Lee_WSP
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Re: Gifting from joint account

Post by Lee_WSP »

gobel wrote: Mon Jul 26, 2021 6:21 pm
His/Her original question was about gift splitting with their spouses, which I think IS allowed and is exactly what gift splitting was intended for: doubling the gift exclusion when a spouse gifts something from non-marital assets. Note, this still requires form 709 so it doesn't completely satisfy the requirements in the OP.
Gift splitting is available to spouses. Not siblings or anyone else.
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