@CalamityJane,
CalamityJane wrote:In that case, I don't think shewolf needs to worry about paying taxes on the donations. It definitely would fall under "gift tax" and it's not (yet) in the 5 digits
No, she does not need to worry about that.
[Like roger said, the giver of the gift (the donor) is the one obligated to pay the tax on the gift. "Gift tax" is the concept that if someone is being generous and giving large sums of money, they need to pay the IRS "gift tax" on any amount gifted in any one year that exceeds the annual exclusion amount. So if Daddy Warbucks gifts away $15,000 to someone in 2013, he needs to pay gift tax on $1,000 (the amount he gifted over the exclusion amount). This is to prevent the uber wealthy from giving away their vast sums of money to their beneficiaries without having to pay estate taxes upon their death. They can start gifting up to $14,000 a year to each of their beneficiaries without having to pay any gift taxes.]