How to Create a Gift Affidavit (Free Templates)

A gift affidavit is a legal document confirming that a gift was given and presenting information about the circumstances. There are many cases where such documents may be required, ranging from political disclosures to file for loan paperwork where people receive a gift to help them with the down payment.

The reference names of the gift affidavit are:

  • Affidavit of Gift
  • Gift Affidavit Form

The most common terms that you will come across in a gift affidavit are:

Gift Giver the individual who owns and gifts the object

Donor another term used to refer to the gift giver

Value how much the object costs in the established monetary terms

Recipient the individual who receives the gift

Notary Public the individual who takes the oath.

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What is a Recurring Gift Affidavit?

A recurring gift affidavit is issued when a person gives the same gift to the same person over some time. Recurring gifts typically include money, with one party agreeing to pay a set sum to another until the giver is no longer obligated to do so, as specified in the affidavit. If one wants to create one after a divorce and promise to support the partner for some time, these are usually created in conjunction with affidavit forms for marriage.

Purpose of a Gift Affidavit

Sometimes, the gift you give must have a gift affidavit, indicating the parties’ name and contact information, the date, and the donation’s nature. It is most commonly seen when people help each other with the down payment on mortgages. Banks may be concerned about people who were unable to save the necessary funds on their own, or they may worry that a “gift” is an unsecured loan and the borrower will get into economic trouble in the future and not be able to pay it.

Requesting a gift affidavit allows a lender to receive documentation on who gave the gift and the circumstances.

In other cases, a person who receives a gift must fill out a gift affidavit that demonstrates the nature of the gift and the circumstances. In some regions, politicians are prohibited from receiving absolute value gifts and must declare all gifts received a common reason for filling out a gift affidavit. These documents can be filed in the public record, allowing people to note the kinds of gifts received by politicians and see who is sending gifts to people, such as legislators.

When a donor knowingly gifts a valued object to someone else, a gift affidavit is required. It’s most often used for giving someone a car or a large sum of money, typically a family member. It proves that a donor gave the item willingly and was not compelled to do so in any way. Affidavits of gifts often act as evidence that the donation was not a debt and that the giver cannot claim its return, reward, or any fee.

When a vehicle is sold from one party to another for no cost or for a sum that is slightly less than the car’s worth, individual states request a gift affidavit. A bank can also require a gift affidavit to show how a buyer is paying the down payment on a property. The lender has to consider if this money must be returned and is, therefore, part of the buyer’s debt burden or whether it is a donation that does not entail repayment.

There are restrictions on who will send the buyer cash for a down payment, depending on the lender, and appropriate laws must be enforced. A gift affidavit will be used to show what is and is not mutually held property in a divorce.

A cash donation can never be used as a down payment for an investment home, and it can never be used as a down payment on a holiday property by traditional lenders.

When is the Gift affidavit Used?

Below are the two most popular scenarios in which a gift affidavit is used;

  • When giving a family member the title to a car as a donation
  • When giving a family member money for a down payment on an estate

Both the donor and the beneficiary may be charged with bribery and prosecuted if it is proved that the funds were offered as a loan rather than a donation and that the gift affidavit was used primarily to escape taxation in both cases.

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Consequences of Not Having the Gift Affidavit

The repercussions of failing to complete a gift affidavit can vary depending on the type of gift offered. If a legitimate gift affidavit is not given, an individual accepting a vehicle as a gift i.e recipient would be obliged to pay taxes on it as though it were bought. Gifts of up to a certain amount in cash or securities per person per year are tax-free under federal law.

 Suppose people deliberately misrepresent the value or circumstances of a gift. It can be considered a form of fraud, mostly when the supporting material affidavit is used for a loan. It is essential to ensure the document accurately reflects the situation as people understand it. Innocent mistakes happen; Someone could, for example, receive an antique that has been improperly valued, and therefore not be aware that the value declared in the affidavit is not correct. Once the error has been recognized, it must be corrected.

You may be required to show that the cash or assets were indeed gifts if you do not have a gift affidavit, or you may be required to pay taxes on these products. Also, the donation may be categorized as a loan or a transaction.

Gifting large sums of money for educational or other reasons will result in complicated tax consequences, so it’s a safe idea to obtain legal, economic, and estate planning advice first.

Situations Not Requiring Gift Affidavit

There are many situations in which you don’t need any gift affidavit as it is a strictly legal document and has a very specific use.

Such situations include:

  • When making cash or other contributions to a charity organization
  • Birthday and other gifts
  • Christmas gifts and other festivals don’t require gift affidavit
  • Prize or lottery money
  • Marriage gifts by guests

Basic Elements of Any Gift Affidavit

A gift affidavit is a legal document that is easy to understand. It should at the very least include these to make the case clear if the giver or receiver gets in a legal situation.

Basic elements are as follow:

Information and address of the donor

This section includes the legal name and address of the donor. The state and county in which they live or currently reside.  This information is added at the beginning of the gift affidavit in a top-down manner like other legal documents.

Statement of the gift

It is the most important section of a gift affidavit. The statement of the gift is placed in the body of the gift affidavit. The statement of gift indicates unequivocally that the gift( object ) is being offered free of cost by the donor to the recipient.

Information of recipient

This element is also placed in the body section of the gift affidavit. It is the information needed to identify the recipient that is optional to mention its legal affiliation to the donor. It is primarily used to present in the cause of any lawsuit.

Description of gift

This element illustrates the description of the gift, including what it is, how much it costs, and when it will be given to the recipient. VIN is included in the gift description section if the gift is any kind of motor vehicle. It also includes the legal description of the object being gifted.

Notary public

This element provides information regarding the person administrating the statements and the vow of the donor.

Gift Affidavit Sample

Date:

To: [bank or lender’s name and address]

ABC plans to make gift  XYZ to [name(s) of the recipient(s)], to be used for the purchase of property located at: [address of the house you’re buying, if known].

There is no expectation or implied compensation in this gift, either in cash or in future facilities, and no lien will be brought against the property by me/us.

[Describe the savings, bank, or another account from which the gift is coming] is the SOURCE of this GIFT.

Donor(s)’ Name(s):

Donor(s) address: street, city, state, zip code

Donor(s) Telephone Number(s):

Donor(s) Email Address(es):

Legal Considerations

The gift affidavit is a legal document which means the law covers it. The laws and regulations regarding the gift affidavit may vary with the country and state in which you are residing.

Difference Between an Affidavit and an Oath

An AffidavitAn Oath
A written document stating facts regarding a particular subject is called an affidavit. The affidavit is not valid without the oath; however, oaths have many other uses.An oath is a commitment or a promise to complete a specified job, as it tells the truth. The oath is something that makes the affidavit equal to legal testimony in a court of law.

Free Templates

Now that you know what a gift affidavit is, when, and why it is used, we offer you a professional and customizable template for free.

Affidavit of Gift Templates 01

Affidavit of Gift Templates 02

Affidavit of Gift Templates 03

Affidavit of Gift Templates 04

Affidavit of Gift Templates 05

Affidavit of Gift Templates 06

Affidavit of Gift Templates 07

Affidavit of Gift Templates 08

Affidavit of Gift Templates 09

    Frequently Asked Questions

    Will the recipients of gifts pay tax if he has a gift affidavit?

    No, you don’t have to pay tax on gifts if you have a gift affidavit unless it exceeds a specific limit.

    Is a gift affidavit necessary with birthday or wedding gifts?

    No, a gift affidavit is not necessary with birthday or wedding gifts.

    Conclusion

    Gift Affidavits are legal documents that contain information about the nature of a gift. It states that you have been given a gift and details the circumstances under which the gifts were received; thus, they help you avoid legal trouble.

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