Can I gift cash to relatives for investment and they give back to me later?

Question

I am currently working at USA holding H1B Visa, and obviously I'm a foreigner, and my parents are not American resident, which means they are not subject to any American Tax, (10% dividend might apply, but capital gain is tax-free).
I have my parents visited me earlier and I opened bank account and IB account for them, so instead of playing the complicated Roth IRA stuff, can I simply wire transfer some money ($15000 gift excursion annually), buy stocks, profit, and when I need money, for example, down payment, just ask them to gift back to me?
Is there any legal or tax issue in this way? Sounds like a better Roth plan.

SJuan76 · Answer

A gift is unconditional. You cannot say "I gift you this but you must return it back to me". If you give the money to your parents, they can chose to spend it however they want to. Claiming that something is a gift when it is not for the purpose of paying less taxes is tax fraud.

If you plan in "gifting" the money and then operating with it in your parents'name with the intent of avoiding to pay taxes, that could lead to additional charges. And if it is without your parents knowledge/consent, they may press charges against you for involving them in a criminal schema and/or identity theft.

Rule of thumb: Getting undeserved money by lying to in contracts and other legal documents usually means you are committing fraud. If that involves the IRS, it often is tax fraud.

Can I gift cash to relatives for investment and they give back to me later?

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