Tuition Paid by Grandma

[Anonymous]

Didn't see the College Forum, so reposting here.

Grandma has generously offered to write a check to pay for our DS first year at a state university. I'm going to do some research, but how does this work? Is this as simple as having GM write check to the college? Are we or DS on the hook for taxes? Is this considered a taxable gift? Anyone have advice? DS is 18.

[Anonymous]

Wow, how amazing!

[Anonymous]

My grandma just wrote a check directly to the college.

[Anonymous]

Not taxable, just her paying tuition just as you would.

[Anonymous]

Can you give her my kid's name as well?

[Anonymous]

If she writes a check to you/ your son, it counts toward the gift threshold. There are no tax consequences if she writes a check directly to the school.

[Anonymous]

Ok, thanks, PPs.

Truly an amazing gift of generosity.

I will have GM write the check directly to the university.

[Anonymous]

Anonymous wrote:Can you give her my kid's name as well?

lol no op but u need to get your own grandma to pay up.

[Anonymous]

Amazing! Have her write the checks directly to the school.

[Anonymous]

Agree with the others, as long as she writes the check directly to the school it should be exempt from the gift tax.

[Anonymous]

Anonymous wrote:Not taxable, just her paying tuition just as you would.

If grandma writes the tuition check directly to the college, it is excluded and doesn't affect gift tax limits.

Room and board count as gifts (so there is a limit on what she can give that isn't taxable. But the limit is high.

Thank you grandma,

[Anonymous]

+1

Better if she writes the check directly unless it's over the annual 'gift limit' for the IRS; then she should gift only up to the annual limit and explore other options.

[Anonymous]

PP. Another option - I think she can also directly contribute annually to a plan. So if it's over the annual gift limit - just have her directly fund the plan (only up to the annual limit).