If I send money to someone on student visa in USA, will he need to pay taxes on that?
First: I am not a tax lawyer. This is just an educated opinion; not a legally verified answer. Taxes are to be paid on income, not on money that you handle for someone. So if the idea is only that he gets and holds the money for you until a later point in time, there should be no tax liability. If the amount is high enough to raise a flag in the bank so the IRS might look at it, and he wants to be sure to not get in trouble, he should keep it separate, and keep a record of 'handing it to you'. Note that if he makes interest on it, or uses it to pay his credit down until you come or such, the situation changes. If i am not wrong, any business activities such should be declared on Year End Tax filing. If your friend is going to own that website either it is commercial or nonprofit, he has to declare in the year end taxation.
"A loan is not a taxable income. Neither is a gift. Loans are repaid with interest. The interest is taxable income to the lender, and may or may not be deductible to the borrower, depending on how the loan proceeds were used. Gifts are taxable to the donor (the person giving the gift) under the gift tax, they're not a taxable income to the recipient. Some gifts are exempt or excluded from gift tax (there's the annual exemption limit, lifetime exclusion which is correlated to the estate tax, various specific purpose gifts or transfers between spouses are exempt in general).  If you trade for something of equal value, is that considered income? Yes. Sale proceeds are taxable income, however your basis in the item sold is deductible from it. If you borrow a small amount of money for a short time, is that considered income? See above. Loan proceeds are not income. does the friend have to pay taxes when they get back their $10? No, repayment of the loan is not taxable income. Interest on it is. Do you have to pay taxes if you are paid back in a different format than originally paid? Form of payment doesn't matter. Barter trade doesn't affect the tax liability. The friend sold you lunches and you paid for them. The friend can deduct the cost of the lunches from the proceeds. What's left - is taxable income. Everything is translated to the functional currency at the fair market value at the time of the trade. you are required to pay taxes on the gross amount Very rarely taxes apply to gross income. Definitely not the US Federal Income taxes for individuals. An example of an exception would be the California LLC taxes. The State of California taxes LLCs under its jurisdiction on gross proceeds, regardless of the actual net income. This is very uncommon. However, the IRC (the US Federal Tax Code) is basically ""everything is taxable except what's not"", and the cost of generating income is one of the ""what's not"". That is why you can deduct the basis of the asset from your gross proceeds when you sell stuff and only pay taxes on the net difference." Whether the amount so received from my son is taxable as my income in India ? No there is no tax liability for you. The money you received from you son would be treated as Gift and would come under Gift-Tax rules. As per current Gift Tax rules, you can receive unlimited funds from close relative, like your son. Any income you generate on these funds, i.e. interest on savings account, FD, etc is taxable to you. Your son maybe liable for taxes in US as in US Gift tax is on donor [i.e. your son]. The yearly limit is $14000 per person after which it can be deducted from estate limit or taxes paid. Can I Send the money back to my personal account of my mother/father in India? Why not? A huge number of Indians working in US are sending money to their parents. There may be multiple reasons like paying a mortgage/loan or sister's wedding or any personal reasons. Usually, there may be a reason column when you send money through any Remittance company.  Do I need to pay any tax here in US or my parents back in India? Parents are direct dependents in India. So you can share your money with your dependents. Your parents have to pay tax for whatever they are earning in India based on the tax slab and age they fit in. So you can even give them the power of Attorney to control your properties in India. Several things to consider: I don't see why your friend should pay any tax. It's not his income at all. And I am not sure where your income should be taxed in this scenario. Is he declaring it as his income somehow? The bank won't do it for him, the transfer as such should be transparent. On the other hand, money transiting on his account could in principle look suspicious, although €300 is unlikely to raise alarm. What I do know is that if you do pay taxes, 20% is not particularly high as such. There are four brackets of income tax (and tax-like contributions to the pension system) in the Netherlands, between 36.55% and 52%. Rates for personal taxes in the Netherlands are simply way higher than what you might be used to in Eastern Europe or what has been mentioned in comments.  In fact, if anything, 20% seems too low. I am at a loss guessing what it could correspond to, you could ask your friend how he came to that number. There various tax discounts (kortingen) and deductions (aftreken) that apply to freelance work (and some that apply to all incomes). €3000 yearly is quite low and would probably not be taxed at all if you were recently registered as freelance (zzp'er) in the Netherlands and had no other sources of income. But on the other hand, if your money is treated as being part of your friend's income, these wouldn't apply, as he is probably already benefiting from them. There are special rules for copyright fees. Not sure this is necessarily 100% kosher but I have met people who got paid that way for articles they wrote in trade publications. First, you'll need to find a service that can handle transferring that amount of money, whether it's using a bank, or wire transferring service. Any major Wall Street bank (Wells Fargo, Chase, Bank of America, etc.) should be able to handle it. You could also use services such as Western Union. As for your legal and tax obligations, according to Western Union: Individuals in Canada and the U.K. don’t have any tax considerations,   unless international payments are received as income or in the form of   capital gains. Only then must they report it on their income taxes,   says Ilyas Patel, director at Ilyas Patel Chartered Certified   Accountants based in Preston, U.K., and the director of Tax Expert, a   tax advice website. To that end, when considering their tax obligations, individuals   should take care to look into the reporting requirements on foreign   income or gifts ranging up to a certain amount. For example, in the   U.S., the Internal Revenue Service (IRS) requires individuals who   receive more than $100,000 U.S. dollars from a foreign source to   report it on a Form 3520. “You may not owe taxes on the money, but it   informs the IRS that you received it,” Gragg says, stressing the   importance of consulting with a professional. “They’re looking for   certain terrorist activities and other illegal activity.” Due to the large sum of money your transferring, it would be in your best interest to speak with a banker (maybe even a lawyer or CPA) about this. Well, that's probably not even all of it. If that stranger did his taxes properly, then he already paid about a third of it to the government because wherever he got it from it was income for him and thus it must have been taxed. Now, the remainder is in your hands and yes, according to US law it is now your income and so now you too, must pay about a third of it to the government, and yes you are supposed to explain where it came from. Be careful giving it to somebody else or it'll be taxed yet again. disclaimer: I am not a US citizen "I'm going to post this as an answer because it's from the GoFundMe website, but ultimately even they say to speak with a tax professional about it.  Am I responsible for taxes? (US Only) While this is by no means a guarantee, donations on GoFundMe are   simply considered to be ""personal gifts"" which are not, for the most   part, taxed as income in the US. However, there may be particular,   case-specific instances where the income is taxable (dependent on   amounts received and use of the monies, etc.).     We're unable to   provide specific tax advice since everyone's situation is different   and tax rules can change on a yearly basis. We advise that you   maintain adequate records of donations received, and consult with your   personal tax adviser.     Additionally, WePay will not report the funds   you collect as earned income. It is up to you (and a tax professional)   to determine whether your proceeds represent taxable income. The   person who's listed on the WePay account and ultimately receives the   funds may be responsible for taxes.     Again, every situation is   different, so please consult with a tax professional in your area. https://support.gofundme.com/hc/en-us/articles/204295498-Am-I-responsible-for-taxes-US-Only- And here's a blurb from LibertyTax.com which adds to the confusion, but enforces the ""speak with a professional"" idea: Crowdfunding services have to report to the IRS campaigns that total   at least $20,000 and 200 transactions. Money collected from   crowdfunding is considered either income or a gift. This is where things get a little tricky. If money donated is not a   gift or investment, it is considered taxable income. Even a gift could   be subject to the gift tax, but that tax applies only to the gift   giver. Non-Taxable Gifts These are donations made without the expectation of getting something   in return. Think of all those Patriots’ fans who gave money to   GoFundMe to help defray the cost of quarterback Tom Brady’s NFL fine   for Deflategate. Those fans aren’t expecting anything in return –   except maybe some satisfaction -- so their donations are considered   gifts. Under IRS rules, an individual can give another individual a   gift of up to $14,000 without tax implications. So, unless a Brady fan   is particularly generous, his or her GoFundMe gift won’t be taxed. Taxable Income Now consider that same Brady fan donating $300 to a Patriots’ business   venture. If the fan receives stock or equity in the company in return   for the donation, this is considered an investment and is not taxable   . However, if the business owner does not offer stock or equity in the   company, the money donated could be considered business income and the   recipient would need to report it on a tax return. https://www.libertytax.com/tax-lounge/two-tax-rules-to-know-before-you-try-kickstarter-or-gofundme/" Gifts from your parents are not treated as income for tax purposes. You should not include that in your subsidy calculation. If you are here on a student-visa and have been in the US for less than 5 years, then you are considered a non-resident alien, and you are not required to buy a qualified plan through the insurance marketplace. You might be able to get a cheaper student plan through your school, but the subsidy might be enough that it's still worth it when calculated correctly. If you are a resident-alien or you are a citizen of the US, then you are required to get coverage, though you can choose not to purchase coverage and pay the tax for not having creditable coverage. That tax cannot be collected by the IRS unless you have already had federal tax withheld. They can only confiscate your tax return money to recoup that money. I don't have enough information to recommend one way or the other what you should do, but I would bet that if you recalculated your subsidy without including your parents income it would cover the majority of the cost. You should also consider applying for Medicaid if you meet the eligibility requirements in your state. You don't need to file or do anything. The bank will report all transfers over 10 000, but chances are slim that it will even be looked at, if you don't do this every week. Worst case, someone will ask you about the source, and you tell them exactly what you wrote above (I had multiple international transfers over 60k and nobody ever asked). You said you paid his tuition, and he is now paying you back, so in case someone asks, you should be able to produce the documentation on the tuition payment - a bill, or your bank statement showing you paid it; and the amount should be matching, so you have proof. Note that if he pays you interest, it is taxable income. You are obligated to list it on your next tax filing. In both the US and UK you are taxed on your income. Transferring your own money from one country to another does not count as income, so you won't be taxed on it. If it's not your money you are transferring that will be different. You may have to report transfers to comply with money laundering rules. You have to report large amounts of cash you bring with you. There might be a problem. Some reporting paperwork will have to be done for the IRS, obviously, but technically it will be business income zeroed out by business expense. Withholding requirements will shift to your friend, which is a mess. Talk to a licensed tax adviser (EA/CPA) about these. But the immigration may consider this arrangement as employment, which is in violation of the visa conditions. You need to talk to an immigration attorney. Most countries tax income in its various ways, but not moving money. If this is a movement of already owned money, it is not tax-relevant. If it is a payment for services done, it is income, and it is the recipient's duty to pay taxes on it. Note that transferring large amounts of money (10k+) between countries can trigger a review, which - worst case - results in questions where it came from. The point of that is solely to verify it was legally earned money (not drug money or such). There is nothing to worry about if the money was legally earned. Technically, if you earn in US (being paid there, which means you have a work visa) and live in other country, you must pay taxes in both countries. International treaties try to decrease the double-taxation, and in this case, you may pay in your country the difference of what you have paid in US. ie. your Country is 20% and USA is 15%, you will pay 5%, and vice-versa. This works only with certain areas. You must know the tax legislation of both countries, and I recommend you seek for advisory. This site have all the basic information you need: http://www.irs.gov/Individuals/International-Taxpayers/Foreign-Earned-Income-Exclusion Good luck. It's the gifter who is liable for gift tax, not the recipient. The recipient just needs to file a certain form for reporting purposes if the gift exceeds a certain amount. "If you have income - it should appear on your tax return. If you are a non-resident, that would be 1040NR, with the eBay income appearing on line 21. Since this is unrelated to your studies, this income will not be covered by the tax treaties for most countries, and you'll pay full taxes on it. Keep in mind that the IRS may decide that you're actually having a business, in which case you'll be required to attach Schedule C to your tax return and maybe pay additional taxes (mainly self-employment). Also, the USCIS may decide that you're actually having a business, regardless of how the IRS sees it, in which case you may have issues with your green card. For low income from occasional sales, you shouldn't have any issues. But if it is something systematic that you spend significant time on and earn significant amounts of money - you may get into trouble. What's ""systematic"" and how much is ""significant"" is up to a lawyer to tell you."