How to declare foreign gift of nearly $10,000
Actually banks aren't required to (and don't) report on 8300 because they already report $10k+ cash transactions to FinCEN as a Currency Transaction Report (CTR), which is substantively similar; see the first item under Exceptions in the second column of page 3 of the actual form. Yes, 8300 is for businesses, that's why the form title is '... Received In A Trade Or Business'.  You did not receive the money as part of a trade or business, and it's not taxable income to you, so you aren't required to report receiving it. Your tenses are unclear, but assuming you haven't deposited yet, when you do the bank will confirm your identity and file their CTR. It is extremely unlikely the government will investigate you for a single transaction close to $10k -- they're after whales and killer sharks, not minnows (metaphorically) -- but if they do, when they do, you simply explain where the money came from. The IRS abuses were with respect to people (mostly small businesses) that made numerous cash deposits slightly under $10k, which can be (but in the abuse cases actually was not) an attempt to avoid reporting, which is called 'structuring'. As long as you cooperate with the bank's required reporting and don't avoid it, you are fine.
As the college education is very costly, I want to send USD 25,000 to him as a gift. What is the procedure and what Indian and American tax laws are involved ? This transaction will be treated as gift. As per Indian law you can transfer unlimited amount to your close relative [son-in-law/grandchildren/daughter/etc]. In US the gift tax is on donor, as you are no US citizen you are not bound by this. As your son-in-law/grandchildren are US citizens, there is no tax to them. Your son-in-law may still need to declare this in Form 3250 or such relevant returns. Under the Liberalized remittance scheme [Refer Q3], you can transfer upto USD 250,000 per year. There maybe some forms that you need to fill. Ask your Bank. If the amount is more than USD 25,000 a CA certificate along with 15CA, 15CB need to be filled. Essentially the CA certifies that taxes on the funds being transferred have already been paid to Govt of India. Can I send money to him directly or to his father who is submitting tax returns in USA? This does not make any difference in India. Someone else may answer this question if it makes a difference in US. So I want to sell my 100 shares of AAPL to him at a price of 10 or   even 1 US Dollar. Is that legal/allowed? Of course. It's your stocks - do with it what you want. if the two persons are not served by a same broker. You'll have to talk to your broker about the technicalities of the transaction. if the person who sell are US citizen and the person who buy are not, and and vice-versa Since you asked specifically about US citizenship, I'll assume you're in the US or the transaction is taking place in the US. Citizenship has nothing to do with it (except may be for economic sanctions against Russians or Iranians that may come into play). What is important is the tax residency status. Such a transfer is essentially a gift, and if you're a US tax resident (which doesn't correlate to your immigration status necessarily) - you'll have to deal with the gift tax consequences on the discount value. For example - you have 100 shares of AAPL which you sold to your friend for $1 each when the fair market value (FMV) was $501. So essentially, the friend got $50,100 value for $100. I.e.: $50K gift. Since this amount is above the annual $14K exemption - you'll have to deal with the gift tax and file gift tax return. There are also consequences for the capital gains tax for both you and your friend. I suggest you talk to a licensed tax adviser (EA/CPA licensed in your State) about the specifics given your circumstances. If you (or the recipient) are also a foreign citizen/tax resident - then that country's laws also may affect your situation. If you trust the other party, an international bank wire would be the quickest, easiest, and cheapest option. It is the standard way to pay for something overseas from the United States. Unfortunately, in most cases, they are not reversible. I don't believe Paypal is an option for an amount that large.  Escrow companies do exist, but you would have to research those on a case by case basis to see if any fit the criteria for your transaction and the countries involved. I'll also add:  If it were me, and there was no way to get references or verify the person's identity and intent to my satisfaction, then I would probably consider hopping on a plane. For that amount of money, I would verify the person and items are legitimate, in person, and then wire the money. It would be better for you to sell yourself and pay capital gains tax than to transfer to your parents and pay the gift tax. Also, sham transfer (you transfer to your mother only so that she could sell and transfer back to you without you paying taxes) will be probably categorized as tax evasion, which is a criminal offense that could lead to your deportation. What the US should or should not claim you can take to your congressman, but the fact is that the US does claim tax on capital gains even if you bought the asset before becoming US tax resident, and that's the current law. Since your question is very particular on the details, I'm assuming you did your research. Unfortunately you won't get a better answer here than what you've found on the Internet already. This is not a clear-cut situation as the situation you're describing has been a source to some confusion. Mainly, the question is whether the US bank account is a tangible asset or not. To the best of my knowledge, this has not yet been settled, so I suggest going to a professional tax adviser (EA/CPA licensed in the US) who'd advise you the best course of action. I think it would be safer to transfer the money directly from the foreign account to the US beneficiary (although even then, if the IRS decides to start digging, it may claim that you're essentially disguising a transfer from a US account, so I suggest talking to a professional before doing anything). In any case, the US recipient will need to report the gift (if it is $100K or more) using the form 3520 with his/her tax return. This is a case where you sit down with an advisor or two. There are legal, and tax issues.  When you deposit the cash, or buy a car with it, the large cash transaction will trigger a notice to the US Government. So they will eventually find out.  Before you get to that point you need to know what obligations and consequences you will be facing. Because you don't know if it was a gift, or found money, or if the owner will be back looking for you to return it; therefore you need expert advice. My understanding is that the only tax implication is that any interest income earned on foreign accounts is still taxable in the US if held by a US citizen. If the total across foreign accounts totals more than $10,000 you'll have to report those accounts to the Treasury via FinCEN Form 114, this doesn't create any additional tax obligations, it's just a regulatory measure to stop people from hiding money overseas and not paying tax on those earnings. If the US account is only in your husband's name, and the Australian account is only in your name, there may not be any reporting requirement to the Treasury. Money transferred between spouses is not subjected to gift-tax. If you are looking to transfer money to another person in the US, you can do do with no tax consequence.  The current annual gift limit is $14k per year per person, so for example, my wife and I can gift $56k to another couple with no tax and no forms. For larger amounts, there is a lifetime exclusion that taps into your $5M+ estate tax. It requires submitting a form 709, but just paperwork, no tax would be due. This is the simplest way to gift a large sum and not have any convoluted tracking or structured loan with annual forgiveness. One form and done. (If the sum is well over $5M you should consider a professional to guide you, not a Q&A board) What you are describing is perfectly legal, and is well under the threshold to attract the attention of the IRS ($10K+).  The money is not income, because it is repayment for goods provided or a loan made to your friends.  I do this myself oftentimes to take advantage of the rewards on my credit cards.  With cash to cover expenses coming in immediately from friends/family, there is virtually no risk. If you are concerned and want to protect against questions in the future about the source of the money, you ought to start keeping records of dates, times, locations, amounts, and the names of people involved when the charges are made.  Then track the dates when the cash is deposited into your bank account.  That way you can demonstrate the cash flow (Charge -> Repayment -> Deposit) to anyone who needs to know. Yes.  If you reply back, they'll confirm that Uncle Alex did indeed leave you $7 million, and you just need to send them a few thousand dollars for taxes and estate fees and then they'll wire you the money.  And then there'll be customs fees.  And then more taxes.  And of course, there will be separate import fees.  And so on until you run out of money. It is correct, in general. Gift tax is indeed at 35%, but you have the first 14K of your gift exempt from it for each person you give to, yearly (verify the number, it changes every year). You can also use your lifetime exemption ($5.45M in 2016, subject to change each year), but at the amounts you're talking about it still will not be enough. Charitable (501(c)) organizations, paying for someone's tuition or medical expenses (directly to the providers), political donations, transfer between you and your spouse - these are all exempt from gift tax. If you have 10 millions to give, I'm sure you can afford a $200 consultation with a EA/CPA licensed in your state. You say that you inherited the money from your mother, and are now paying these people using money that is already yours.  Because of that, the money is considered a gift from you to them, and the fact that you are doing it in accordance with your mother's wishes doesn't change that.  For it to be considered a bequest from your mother's estate directly to these beneficiaries, it would have had to be handled via the regular by-the-book inheritance procedure and been given to them directly rather than bequeathed to you with informal instructions to pass it on to them. If one gives another person more than $14K in any calendar year, there is the potential gift tax issue to address. I'll explain why it's more a matter of 'addressing' than 'paying', as there are a number of legal ways around this.  Form 709 is what you'll use. In the end, you'll report the gifts over $14K but no tax will be due as they'll simply go against your lifetime gifting allowance, currently $5.49M per person.  Note, 2 ways to avoid even this obligation. If you have a spouse, you have a combined $28K/yr gifting (per recipient) with no reporting required. Similarly, if the recipient has a spouse, you can gift them $14K. i.e. couple to couple can gift $56K/yr. Last, why not just gift $14K before December, and in January, give the second installment? If I had money coming in separate from a will, I'd be happy that you honored a verbal request, and wouldn't be so greedy as to expect you to risk a dime of your own finances to transfer the funds immediately. The LLC portion is completely irrelevant. Don't know why you want it. You can create a joint/partnership trading account without the additional complexity of having LLC. What liability are you trying to limit here? Her sisters will file tax returns in the us using the form 1040NR, and only reporting the dividends they received, everything else will be taxed by Vietnam. You'll have to investigate how to file tax returns there as well. That said, you'll need about $500,000 each to invest in the regional centers. So you're talking about 1.5 million of US dollars at least. From a couple of $14K gifts to $1.5M just by trading? I don't see how this is feasible. I can't speak to New Zealand law, but under US law, it's not a gift, so there is no tax. But there are some practical considerations. How good a relationship do you have with the banks on each end of the transfer? Transfers in the neighborhood of USD$10,000 are automatically considered suspicious and the banks are required to take extra steps to ensure you are not laundering the proceeds of criminal activity, funding terrorism, evading taxes, etc. You will have to fill out quite a bit of paperwork. As I understand it, US federal gift tax doesn't kick in at all until one person gives more than about $14,000 in a single year. (So a couple can give someone $28,000.) If you want to give more than that in a lump sum while avoiding gift tax, one workaround is to structure it as an intra-family loan. Basically, you write (and formally register) a loan for the amount, then gift them with up to the limit for them to pay off that loan. The IRS requires that you charge interest on this loan, but the rates are pretty minimal and of course you can incorporate that in the gift. The downside is that the interest income you're required to take is taxable, but that's a comparitively small sum. (On the other hand, if the loan is a mortgage against real property, and properly filed as such, the interest paid may be deductable for the person you're giving the money to.) Doing this properly requires a tax accountant or lawyer who has a clue about the right legalese to make it work. However, there are starting to be some services which specialize in this, doing it for a fixed fee. I used one of those recently, which is why I'm somewhat familiar with this process; they made it about as much of a fill-out-the-forms process as they could, but it still took a few weeks for me to figure out which options were best for my needs.