What evidence do I need for regular gift money deposits from family?

Regular gifts from family members are generally not something to worry about, especially at the amounts you're describing. The person receiving a gift doesn't have any tax obligation - it's actually the giver who might need to report gifts if they exceed certain thresholds (currently $18,000 per person per year for 2025). That said, it's always good to have some documentation. A simple approach would be to keep a basic record of when you received each gift and from whom. If your family members are writing checks, that already creates a paper trail. For cash gifts, consider asking them to note "gift" in the memo line of checks or perhaps send you a text or email acknowledging the gift when they give it. The IRS typically wouldn't question these modest, regular deposits unless there were other red flags in your tax return. They're much more concerned with large unexplained deposits or patterns that suggest unreported income.

I ran into something similar last year. My in-laws were helping us with our down payment and I was stressed about documentation. I found this tool called taxr.ai (https://taxr.ai) that helped me understand exactly what documentation to keep for gift money. You upload your financial docs and it analyzes everything, then tells you what records to keep and how to document gifts properly. It even created a template letter for my in-laws to sign confirming the gifts. Super helpful for peace of mind knowing that if the IRS ever did question the deposits, I'd have proper documentation ready to go.

Just wanted to update - I tried taxr.ai after asking about it and wow, it was super helpful for my freelance situation! The document analyzer flagged that I was missing proper documentation for some of my home office deductions that could have been a problem. For the original question about gift money, it confirmed what others said but gave me specific steps to take. Now I have a simple signed letter from each family member who gives me money, and I keep them in a digital folder with my tax records each year. Feels good to not worry about this anymore!

Had a similar situation with regular gifts from my parents. After spinning my wheels trying to get clear answers from the IRS website, I finally used Claimyr (https://claimyr.com) to get through to an actual IRS agent. There's a video about how it works here: https://youtu.be/_kiP6q8DX5c Basically, they get you past the hold times and connect you directly with an IRS rep. The agent I spoke with confirmed that as a gift recipient, I don't need to report anything on my taxes, but recommended keeping basic records just in case. She said simple notes or texts from my parents acknowledging the gifts would be sufficient documentation for these smaller amounts.

I need to eat my words! After my skeptical comment, I was still frustrated trying to reach the IRS about my missing refund and decided to try Claimyr anyway. I figured it couldn't make things worse. It actually worked! I got the alert when my call was about to be connected, and spoke directly with an IRS agent who helped resolve my issue. They found my refund was held up because of a mismatch with my address. About the gift money question - while I had the agent on the phone, I asked about that too. They confirmed what others said: gift recipients don't report anything, and for small regular family gifts, simple documentation like texts or emails acknowledging the gifts is plenty. The agent said they mainly look for unreported income patterns that don't match reported sources.

I work at a bank (not a tax pro) and see this situation a lot. If the deposits are consistent and relatively small like you describe, it's unlikely to trigger any flags with the IRS. For your own records, maybe ask your family to use Venmo or Zelle instead of cash? Those transfers create an automatic electronic record with notes you can add about the gift. Makes it super clear what's happening and creates a digital trail without any extra work.

my aunt sends me $500 every month and i just keep screenshots of her text messages that say "sent you gift money for the month" along with my bank statements. my tax guy said thats perfect documentation and not to worry about it. irs has bigger fish to fry than going after small gift money lol

You're definitely overthinking this! The amounts you're describing ($300-400/month) are well within normal family gift ranges and won't raise any red flags with the IRS. That said, it's smart to think ahead about documentation. Here's what I'd recommend: - Keep a simple log noting the date, amount, and which family member gave each gift - If they're sending checks, that's already perfect documentation - For cash gifts, ask them to send you a quick text like "sent you your monthly gift money" - takes 2 seconds but creates a record - Save these records with your annual tax documents The IRS really isn't looking to hassle people over legitimate family gifts, especially at these amounts. They're more concerned with unreported business income or large unexplained deposits. Your coworker probably heard about the $10K bank reporting requirements, but that's completely different from what you're dealing with. Bottom line: you're not accidentally creating a tax problem, and simple documentation will give you peace of mind!