Do You Have to Pay Income Tax on a Cash Gift?

Generally, cash or property that you receive as a gift or inheritance is not included in your income. Recipients of gifts do not need to declare them on their income tax return, regardless of the amount.

However, if a cash gift later produces income, such as dividends and capital gains, that income will be taxable and you will receive a 1099 form to indicate the taxable amount.

Donors can give cash gifts up to a certain amount each year without …