paying for child's wedding

Discussion in 'Tax' started by Gary Goodman, Oct 5, 2003.

  1. Gary Goodman

    Gary Goodman Guest

    Any cites for paying for a child's wedding *NOT* as a
    taxable gift? I favor the "throwing a party at which the kid
    just happens to get married" philosophy. Of course this
    doesn't work if you throw a lump of money at the kid and say
    "here's the money for your wedding, pay the caterer, etc. on
    your own."

    Has anybody had the IRS question this?

    Gary

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    Gary Goodman, Oct 5, 2003
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  2. Gary Goodman

    D. Stussy Guest

    Gary Goodman wrote:

    > Any cites for paying for a child's wedding *NOT* as a
    > taxable gift? I favor the "throwing a party at which the kid
    > just happens to get married" philosophy. Of course this
    > doesn't work if you throw a lump of money at the kid and say
    > "here's the money for your wedding, pay the caterer, etc. on
    > your own."
    >
    > Has anybody had the IRS question this?


    Nothing to cite here - but if such were to be considered a
    taxable gift, there would be a large, social revolt in this
    country.

    Ask Dick Adams for an alternate opinion on the idea. (Hello
    moderator....) :)

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    D. Stussy, Oct 6, 2003
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  3. Gary Goodman

    Dick Adams Guest

    Gary Goodman" <> wrote:

    > Any cites for paying for a child's wedding *NOT* as a
    > taxable gift? I favor the "throwing a party at which the kid
    > just happens to get married" philosophy. Of course this
    > doesn't work if you throw a lump of money at the kid and say
    > "here's the money for your wedding, pay the caterer, etc. on
    > your own."
    >
    > Has anybody had the IRS question this?


    I did a search for this and all I found that was even
    remotely on target was a Revenue Ruling that said the
    expenditures could be used in the support test.

    There is a Tax Court case stating that weddings are not
    business expenses - although it has been done.

    There is also a Tax Court case concerning the estate of
    some gypsies - but that was decided upon the absence of
    records.

    So it would appear that this issue has yet to be a point
    of argument. But that is not a surprise since no tax is
    due until you exceed the lifetime exemption and problems
    do not arise until someone does the estate tax computations.
    So it would have to be a very expensive wedding and a large
    estate.

    Dick

    P.S.: Encourage your children to engage in unmarried
    cohabitation. It's the economically optimal
    solution for parents.

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    Dick Adams, Oct 6, 2003
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  4. Gary Goodman" <> wrote:

    > Any cites for paying for a child's wedding *NOT* as a
    > taxable gift? I favor the "throwing a party at which the kid
    > just happens to get married" philosophy. Of course this
    > doesn't work if you throw a lump of money at the kid and say
    > "here's the money for your wedding, pay the caterer, etc. on
    > your own."
    >
    > Has anybody had the IRS question this?


    This was discussed somewhere before, and as I recall, the
    conclusion was that if you gave all the money to the kid, it
    would be difficult to call it anything other than a gift.
    But if you paid the caterers, bartenders, room charge, etc.,
    direct, and lots of people came, it would be difficult to
    call it a gift to any single person.

    At any rate, that's how most folks I know handle it, and
    there have been no problems.

    -HW "Skip" Weldon
    Columbia, SC

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    HW \Skip\ Weldon, Oct 6, 2003
    #4
  5. Gary Goodman <> wrote:

    > Has anybody had the IRS question this?


    No, but a couple of clients have asked about it. I favor
    having the parents cut checks for the major expenses
    DIRECTLY, rather than just handing a lump sum of money to
    the kids. An alternate approach, I suppose, would be to ask
    the kids to submit an itemized list of expenses paid (a sort
    of an "accountable plan" <g>).

    MTW

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    Michael T Wing CPA, Oct 6, 2003
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  6. Gary Goodman

    Herb Smith Guest

    "Gary Goodman" <> wrote:

    > Any cites for paying for a child's wedding *NOT* as a
    > taxable gift? I favor the "throwing a party at which the kid
    > just happens to get married" philosophy. Of course this
    > doesn't work if you throw a lump of money at the kid and say
    > "here's the money for your wedding, pay the caterer, etc. on
    > your own."
    >
    > Has anybody had the IRS question this?


    You mean does it pass the snicker test? There is NOTHING
    about financing a wedding party which would be deductible,
    unless there would be some business purpose for the party.
    Gifts are not deductible, no matter how you structure them.

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    Herb Smith, Oct 7, 2003
    #6
  7. Gary Goodman wrote:

    > Any cites for paying for a child's wedding *NOT* as a
    > taxable gift? I favor the "throwing a party at which the kid
    > just happens to get married" philosophy. Of course this
    > doesn't work if you throw a lump of money at the kid and say
    > "here's the money for your wedding, pay the caterer, etc. on
    > your own."
    >
    > Has anybody had the IRS question this?


    I can't answer the question about IRS's attitude, but for it
    to be considered a taxable gift, the expenditure would have
    to be over 11,000$. I can't imagine a wedding costing that
    much. (or even 22,000$ assuming joint gift!)

    Cheer$,
    Harlan Lunsford, EA in LA

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    Harlan Lunsford, Oct 7, 2003
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  8. Gary Goodman

    bill brown Guest

    "Gary Goodman" <> wrote:

    > Any cites for paying for a child's wedding *NOT* as a
    > taxable gift? I favor the "throwing a party at which the kid
    > just happens to get married" philosophy. Of course this
    > doesn't work if you throw a lump of money at the kid and say
    > "here's the money for your wedding, pay the caterer, etc. on
    > your own."
    >
    > Has anybody had the IRS question this?


    I asked the same question of this group in Dec 2002 and got
    a number of interesting replies, mostly along the "throwing
    a party" line. A search of Subject: Re: Is Wedding a
    "gift?"? should find it.

    -bill
    cc: copy of most replies direct to questioner.

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    bill brown, Oct 7, 2003
    #8
  9. "Gary Goodman" <> wrote:

    > Any cites for paying for a child's wedding *NOT* as a
    > taxable gift? I favor the "throwing a party at which the kid
    > just happens to get married" philosophy. Of course this
    > doesn't work if you throw a lump of money at the kid and say
    > "here's the money for your wedding, pay the caterer, etc. on
    > your own."
    >
    > Has anybody had the IRS question this?


    If your child is your dependent in the year in question, and
    does not file a joint tax return with his or her new spouse,
    the expenditures count as support, as follows:

    Rev. Rul. 76-184, 1976-1 CB 44 -- IRC Sec. 152
    Reference(s): Code Sec. 152; Reg § 1.152-1

    Full Text:
    A parent made expenditures for a child's wedding apparel and
    accessories, the wedding reception, and for flowers for the
    wedding party, church, and reception. The child did not file
    a joint return for the year in which the child was married.

    Section 152(a) of the Internal Revenue Code of 1954 defines
    the term "dependent" as including a child of the taxpayer,
    "over half of whose support for the calendar year in which
    the taxable year of the taxpayer begins, was received from
    the taxpayer." The term "support" is defined in section
    1.152-1(a)(2) of the Income Tax Regulations as including
    food, shelter, clothing, medical and dental care, education,
    and the like.

    Held, the expenditures made by the parent in the instant
    case for the child's wedding apparel and accessories, the
    wedding reception, and for flowers for the wedding party,
    church, and reception, are part of the child's support for
    purposes of determining whether the child is the parent's
    dependent for Federal income tax purposes.

    Joel Berry, CPA

    Sugar Land, Texas

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    Joel Berry, CPA, Oct 8, 2003
    #9
  10. Wedding expenses traditionally are paid for by the parents
    of the bride. This dates well back to medieval times. Thus
    if the parents Pay for the wedding, it is not a gift. If
    however, the Parents Give money to the bride and or groom
    ant they use it to finance wdding expenses, The IRS may look
    at it as a Gift.

    Most likely The IRS would want to be assured that the funds
    are actually used for the wedding and not an end run around
    the gift tax laws.

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    Hrblockhead14, Oct 8, 2003
    #10
  11. Gary Goodman

    A.G. Kalman Guest

    Harlan Lunsford <> wrote:
    > Gary Goodman wrote:


    >> Any cites for paying for a child's wedding *NOT* as a
    >> taxable gift? I favor the "throwing a party at which the kid
    >> just happens to get married" philosophy. Of course this
    >> doesn't work if you throw a lump of money at the kid and say
    >> "here's the money for your wedding, pay the caterer, etc. on
    >> your own."
    >>
    >> Has anybody had the IRS question this?


    > I can't answer the question about IRS's attitude, but for it
    > to be considered a taxable gift, the expenditure would have
    > to be over 11,000$. I can't imagine a wedding costing that
    > much. (or even 22,000$ assuming joint gift!)


    $44,000 for joint to bride and groom.

    Alan
    http://taxtopics.net

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    A.G. Kalman, Oct 8, 2003
    #11
  12. Harlan Lunsford wrote:
    > Gary Goodman wrote:


    >> Any cites for paying for a child's wedding *NOT* as a
    >> taxable gift? I favor the "throwing a party at which the kid
    >> just happens to get married" philosophy. Of course this
    >> doesn't work if you throw a lump of money at the kid and say
    >> "here's the money for your wedding, pay the caterer, etc. on
    >> your own."
    >>
    >> Has anybody had the IRS question this?
    >>
    >>


    > I can't answer the question about IRS's attitude, but for it
    > to be considered a taxable gift, the expenditure would have
    > to be over 11,000$. I can't imagine a wedding costing that
    > much. (or even 22,000$ assuming joint gift!)


    You must have never been to a NY wedding! $11,000, chump
    change. Get a quote for the Tavern on the Green.

    --
    Frederick E. Jorden http://Tax-Accounting-Payroll.com
    7825 Midlothian Tpk - 207 Richmond, VA 23235-5247 EMAIL
    (804) 320-6210 FAX (804) 320-6211

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    Frederick Jorden, Oct 8, 2003
    #12
  13. Harlan Lunsford <> wrote:
    > Gary Goodman wrote:


    >> Any cites for paying for a child's wedding *NOT* as a
    >> taxable gift? I favor the "throwing a party at which the kid
    >> just happens to get married" philosophy. Of course this
    >> doesn't work if you throw a lump of money at the kid and say
    >> "here's the money for your wedding, pay the caterer, etc. on
    >> your own."
    >>
    >> Has anybody had the IRS question this?


    > I can't answer the question about IRS's attitude, but for it
    > to be considered a taxable gift, the expenditure would have
    > to be over 11,000$. I can't imagine a wedding costing that
    > much. (or even 22,000$ assuming joint gift!)


    I will send my kids to LA for their weddings :). Up here
    weddings can easily exceed $22,000.

    Drew Edmundson, CPA (NC)
    e-mail is my first name at nccpa dot com

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    Drew Edmundson, Oct 8, 2003
    #13
  14. "Harlan Lunsford" <> wrote:
    > Gary Goodman wrote:


    > I can't answer the question about IRS's attitude, but for it
    > to be considered a taxable gift, the expenditure would have
    > to be over 11,000$. I can't imagine a wedding costing that
    > much. (or even 22,000$ assuming joint gift!)


    Harlan, you must not have kids of marryin' age. My daughter
    got married in May, and my son is getting married in
    January. Wedding costs are unbelievable, and that's for a
    "regular", i.e. not a "country club", wedding. I continue
    to be amazed at some of the costs for wedding items.

    Around thirty years ago, before I became a CPA, my family
    was in the bridal business. I couldn't believe then how
    much people spent on weddings. The cost has gotten worse
    since then.

    Joel Berry, CPA
    Sugar Land, Texas

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    Joel Berry, CPA, Oct 8, 2003
    #14
  15. Harlan Lunsford <> wrote

    > I can't answer the question about IRS's attitude, but for it
    > to be considered a taxable gift, the expenditure would have
    > to be over 11,000$. I can't imagine a wedding costing that
    > much. (or even 22,000$ assuming joint gift!)


    You need an updated imagination! <G> Perhaps the problem is
    in the Napoleonic translation. Here are the figures from a
    few years ago by region and nationally:

    Total Cost Per Person Cost

    Northeast 31,777.00 168.13
    Southeast 17,142.00 90.70
    Midwest 19,324.00 102.24
    West Coast 17,517.00 92.68
    All USA 18,874.00 99.86

    Interestingly, I just saw a quick fact that nationally, the
    average cost of a divorce is $20,000 - roughly the same cost
    as the average wedding.

    It reminds me of when I bought my first house almost 20
    years ago for $73,000. My father thought I was crazy. When
    I sold it for three times that amount he just shook his head
    in disbelief.

    Peter C. Gatto, CPA

    ============================================================
    Moderator:
    It's just more evidence that encouraging your children to
    either shack-up or elope is in your economic best interest!
    ============================================================

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    Peter C. Gatto, Oct 11, 2003
    #15
  16. A.G. Kalman wrote:
    > Harlan Lunsford <> wrote:
    >> Gary Goodman wrote:


    >>> Any cites for paying for a child's wedding *NOT* as a
    >>> taxable gift? I favor the "throwing a party at which the kid
    >>> just happens to get married" philosophy. Of course this
    >>> doesn't work if you throw a lump of money at the kid and say
    >>> "here's the money for your wedding, pay the caterer, etc. on
    >>> your own."
    >>>
    >>> Has anybody had the IRS question this?


    >> I can't answer the question about IRS's attitude, but for it
    >> to be considered a taxable gift, the expenditure would have
    >> to be over 11,000$. I can't imagine a wedding costing that
    >> much. (or even 22,000$ assuming joint gift!)


    > $44,000 for joint to bride and groom.


    Right of course. But even the more ludricrous! lol

    C$,
    HL

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    Harlan Lunsford, Oct 11, 2003
    #16
  17. Joel Berry, CPA wrote:
    > "Gary Goodman" <> wrote:


    >> Any cites for paying for a child's wedding *NOT* as a
    >> taxable gift? I favor the "throwing a party at which the kid
    >> just happens to get married" philosophy. Of course this
    >> doesn't work if you throw a lump of money at the kid and say
    >> "here's the money for your wedding, pay the caterer, etc. on
    >> your own."
    >>
    >> Has anybody had the IRS question this?


    > If your child is your dependent in the year in question, and
    > does not file a joint tax return with his or her new spouse,
    > the expenditures count as support, as follows:
    >
    > Rev. Rul. 76-184, 1976-1 CB 44 -- IRC Sec. 152
    > Reference(s): Code Sec. 152; Reg § 1.152-1
    >
    > Full Text:
    > A parent made expenditures for a child's wedding apparel and
    > accessories, the wedding reception, and for flowers for the
    > wedding party, church, and reception. The child did not file
    > a joint return for the year in which the child was married.
    >
    > Section 152(a) of the Internal Revenue Code of 1954 defines
    > the term "dependent" as including a child of the taxpayer,
    > "over half of whose support for the calendar year in which
    > the taxable year of the taxpayer begins, was received from
    > the taxpayer." The term "support" is defined in section
    > 1.152-1(a)(2) of the Income Tax Regulations as including
    > food, shelter, clothing, medical and dental care, education,
    > and the like.
    >
    > Held, the expenditures made by the parent in the instant
    > case for the child's wedding apparel and accessories, the
    > wedding reception, and for flowers for the wedding party,
    > church, and reception, are part of the child's support for
    > purposes of determining whether the child is the parent's
    > dependent for Federal income tax purposes.


    Ah finally , we have a winner!

    But..... IF the childbride had filed a joint return with
    her new hubby?

    C$,
    HL

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    Harlan Lunsford, Oct 11, 2003
    #17
  18. Frederick Jorden wrote:
    > Harlan Lunsford wrote:
    >> Gary Goodman wrote:


    >>> Any cites for paying for a child's wedding *NOT* as a
    >>> taxable gift? I favor the "throwing a party at which the kid
    >>> just happens to get married" philosophy. Of course this
    >>> doesn't work if you throw a lump of money at the kid and say
    >>> "here's the money for your wedding, pay the caterer, etc. on
    >>> your own."
    >>>
    >>> Has anybody had the IRS question this?


    >> I can't answer the question about IRS's attitude, but for it
    >> to be considered a taxable gift, the expenditure would have
    >> to be over 11,000$. I can't imagine a wedding costing that
    >> much. (or even 22,000$ assuming joint gift!)


    > You must have never been to a NY wedding! $11,000, chump
    > change. Get a quote for the Tavern on the Green.


    Grief! Now I KNOW yankees are godless; imagine getting
    married in a tavern. ;)

    C$,
    HL

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    Harlan Lunsford, Oct 11, 2003
    #18
  19. Peter C. Gatto <> wrote:

    > It reminds me of when I bought my first house almost 20
    > years ago for $73,000. My father thought I was crazy. When
    > I sold it for three times that amount he just shook his head
    > in disbelief.
    >
    > ============================================================
    > Moderator:
    > It's just more evidence that encouraging your children to
    > either shack-up or elope is in your economic best interest!
    > ============================================================


    Add to Moderator's comment, "...and buy a home!"

    MTW

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    Michael T Wing CPA, Oct 17, 2003
    #19
  20. Gary Goodman

    Bob Oaks Guest

    "Michael T Wing CPA" <> wrote:
    > Peter C. Gatto <> wrote:


    >> It reminds me of when I bought my first house almost 20
    >> years ago for $73,000. My father thought I was crazy. When
    >> I sold it for three times that amount he just shook his head
    >> in disbelief.
    >>


    Goodness; you're obviously not in California!

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    Bob Oaks, Oct 18, 2003
    #20
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