Generally gifts are not taxed to the recipient...however, it is almost impossible for (for example) an employer to make a gift to an employee, this is likely to be reclassified as compensation by the IRS.
== == No, not to the recepient. The tax is paid as a gift tax by the givor. (Although it has to be a gift , and as noted, gifts by an employer to an employee are actually always considered payroll.)
If you gave any one person gifts in 2006 that valued at more than $12,000, you must report the total gifts to the Internal Revenue Service and may have to pay tax on the gifts. The person who receives your gift does not have to report the gift to the IRS or pay gift or income tax on its value. Gifts include money and property, including the use of property without expecting to receive something of equal value in return. If you sell something at less than its value or make an interest-free or reduced-interest loan, you may be making a gift. There are some exceptions to the tax rules on gifts. The following gifts do not count against the annual limit: * Tuition or Medical Expenses that you pay directly to an educational or medical institution for someone's benefit * Gifts to your Spouse * Gifts to a Political Organization for its use * Gifts to Charities If you are married, both you and your spouse can give separate gifts of up to the annual limit to the same person without making a taxable gift.