Question ~ Online Money Transfers

[-JAW-]

If I send or receive money online, say via PayPal, does the recipient have to pay taxes? What About internationally? If I send a friend in South America money to buy something locally (Where if I shipped the item, duty would be collected) does he have to pay tax on the money I send?



:rybka:

[flatscat1]

I don't think the act of simply sending or wiring money would trigger a taxable event. You are usually taxed on earned or investment income/losses. How would this transaction be classified? A sale? A gift? A loan? You can gift someone in the US up to $12K per year tax free.