I am a US citizen and am wanting to send around $22,000 to my fiancée in China. What's the best way to do this? I was thinking of sending $13k per wire transfer to her account and then taking $9k with me when I visit her next month. Are there any tax implications?

Have you ever met her in person? Is this an Internet romance?

Wire transfer of money is a huge red flag for scam.

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Originally Posted by Wondergirl

Have you ever met her in person? Is this an Internet romance?

Wire transfer of money is a huge red flag for scam.

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Yes, we're very close. No need for concern.

Such a transfer represents a GIFT. The first $13,000 is exempt, but the rest will require submission of a gift tax return.

So, would it be better for us to get married first and then wire transfer the money to her in full? What kind of percentage do they take for the GIFT tax?

You would not have to pay a gift tax, as you would access your Unified Credit to avoid the tax.

However, if you can wait until AFTER you get married, that would take of the problem, as there is NO gift tax for gifts between spouses.

Unified credit?

Can I just take the money with me on the plane and give it to her when I get there next month? Then, instead of calling it a GIFT, if asked, I'll just say that I used the money for our wedding and honeymoon? Would that be OK? Would I still need to report anything?

If you GIVE it to her to spend as sge wishes, it is a gift.

If you use the money to pay wedding expenses, then it is not.

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Originally Posted by AtlantaTaxExpert

Such a transfer represents a GIFT. The first $13,000 is exempt, but the rest will require submission of a gift tax return.

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Originally Posted by AtlantaTaxExpert

Such a transfer represents a GIFT. The first $13,000 is exempt, but the rest will require submission of a gift tax return.

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Since we are buying an apartment with this money, what about calling it an investment and not a gift? Someone told me that we can write up a contract saying that we're going to mutually enter an investment into real estate and that I'm sending her money to hold and then use to buy an apartment in Shanghai. That it's not a gift and that we'll split the gain/loss up 50/50. Then just pay a capitol gain tax on it later, hopefully, when we sell. We'll be married by then too, which I'm not sure exactly how that'll change things but I'll figure that out later. Would it be OK to do it like that? Thanks in advance for any help.

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Originally Posted by AtlantaTaxExpert

If you GIVE it to her to spend as sge wishes, it is a gift.

If you use the money to pay wedding expenses, then it is not.

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She'll be using the money to help with the down payment of an apartment in Shanghai. We will marry next month, before completion of sale.

Such a written agreement is probably prudent, but likely is NOT really needed.

So, I'll be OK by just sending 22k per wire transfer from my US bank to her Chinese bank?

My friend said something about filing a gift tax return for $0. Not sure why

He probably meant that the gift tax return would be filed, but no tax is owed.

If you do what we discussed, NO gift tax return is needed.

So, is everything I've mentioned doing legal? I can just send her $22k? Anything else I need to know? Also, is this the best way to go about doing this?

Sorry I'm asking so many questions. I really appreciate the help. One more question: She will be buying the apartment in her name. How will the potential Capitol gain tax work? Is there any circumstance in which we would be taxed twice on the gain. A tax in China and then in the states?

No, you will be able to claim a tax credit for any taxes paid to China, thus avoiding any double taxation.

And, yes, what you want to do is perfectly legal.

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Originally Posted by AtlantaTaxExpert

No, you will be able to claim a tax credit for any taxes paid to China, thus avoiding any double taxation.

And, yes, what you want to do is perfectly legal.

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Do you think it'd be best to do this in 3 transfers of $7k?

There is no issue in money transfers, some US banks have connections with Chinese banks, for example ABC bank in China is connected with Wells Fargo and there is no transfers fee at all.