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Posted by denisepearson01 on October 4, 2007, 5:56 am
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I'm a U.S. citizen. Is there a IRS rule limiting how much I
can give (or gift?) to other U.S. citizens? Does it depend
on:
1.) The total I've given (or gifted) to a particular
individual this year?
2.) The total I've given (or gifted) to a particular
individual since I began giving a few years ago?
3.) The total I've given (or gifted) to anyone/everyone this
year?
4.) The total I've given (or gifted) to anyone/everyone
since I began giving a few years ago?
If my giving or gifting does trigger an IRS tax, is the tax
on:
1.) The total I've given (or gifted) to a particular
individual this year?
2.) The total I've given (or gifted) to a particular
individual since I began giving a few years ago?
3.) The total I've given (or gifted) to anyone/everyone this
year?
4.) The total I've given (or gifted) to anyone/everyone
since I began giving a few years ago?
Or is the tax on any "new" amounts given after a particular
threshold is met (e.g., $10,000) ?
If it is, is that threshold per person/per lifetime, or for
everyone per lifetime, or per person/per year, or for
everyone per year?
Or does the "lifetime" part have to do with my lifetime, as
opposed to the lifetime of my recipient(s)?
Thanks, in advance, for the clarification.
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Posted by Paul Thomas, CPA on October 5, 2007, 12:22 am
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> I'm a U.S. citizen. Is there a IRS rule limiting how much I
> can give (or gift?) to other U.S. citizens?
Nope. TherE are no limits set by anyone on making or
receiving gifts of any amount.
That being said, if the annual gifts made to any one
individual exceed $12,000, then a gift tax return must be
filed by the person making the gift. No gift tax is due
however, until the person making the gift exceeds their
lifetime exclusion.
--
Paul A. Thomas, CPA
Athens, Georgia
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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Posted by joetaxpayer on October 5, 2007, 12:22 am
Please log in for more thread options denisepearson01@gmail.com wrote:
> I'm a U.S. citizen. Is there a IRS rule limiting how much I
> can give (or gift?) to other U.S. citizens? Does it depend
> on:
(snip every permutation offered)
In 2007 and 2008, you may gift $12K each year to any number
of recipients you wish. (It was 10K, then 11K, a few years
back, now $12K)
Any amount over $12K requires you to file a form 709, which
you can get from IRS.gov . You then may pay the gift tax or
take a credit against your lifetime unified gift amount, $1M
and avoid taxes. There may also be an issue of gifting too
much to recipient more than one generation beneath you, but
that does not impact the $12K gift, only larger ones.
There are some minor variations on this theme, for example,
if you open a 529 college savings account, you may gift 5
years' deposits in advance, so $60K. But then, no gifting
anything to that recipient for next 4 years.
Gifts to charities are tax deductible, if you itemize, gifts
to individuals are not.
If you are beyond the $12K, and used up that $1M above, you
may want to consider converting IRA money to a Roth IRA.
Inherited IRAs are subject to both estate tax, and then,
income tax upon withdrawal by the beneficiary. A Roth is not
taxed on withdrawal, so this strategy can be used to reduce
your estate if you are pushing the limit, and to leave a
better inheritance if that's your wish.
If this doesn't answer the question in full and then some,
likely, another response will. Given the complex tax laws,
this topic tends toward the straightforward.
JOE
www.blog.joetaxpayer.com
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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Posted by Bill on October 5, 2007, 12:22 am
Please log in for more thread options denisepearson01@gmail.com posted:
> I'm a U.S. citizen. Is there a IRS rule limiting
> how much I can give (or gift?) to other U.S.
> citizens? Does it depend on:
> 1.) The total I've given (or gifted) to a
> particular individual this year?
> 2.) The total I've given (or gifted) to a
> particular individual since I began giving a few
> years ago?
> [Remainder of list elided for brevity.]
I hope you'll understand, Denise, that I didn't continue
with your entire list of options, because the answer is very
clear and simple:
At the present time, you may give a gift up to $12,000 to
any individual _every year_ without incurring any gift tax
liability, and without any need to report such gift. For
the recipient, there is never any obligation to report gifts
-- and no tax is ever due.
Furthermore, if you're married, you and your spouse can
_each_ give $12,000 -- for a total of $24,000 to any
individual, each year. (If, for example, you wanted to give
a gift to your married child, you could actually combine to
give the couple a total of $48,000 -- $12,000 to each of
them, from the two of you -- without any tax or report due.)
Each year starts anew, so long as you do not exceed the
limit. (And if you do, there is some reporting required --
but the net effect is to reduce the estate tax limitations
for the particular beneficiary involved. If that were the
case, you should consult your attorney -- but no immediate
tax liability would be incurred.)
Bill
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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Posted by Mike Wellman on October 5, 2007, 12:22 am
Please log in for more thread options denisepearso...@gmail.com wrote:
> I'm a U.S. citizen. Is there a IRS rule limiting how much I
> can give (or gift?) to other U.S. citizens? Does it depend
> on:
>
> 1.) The total I've given (or gifted) to a particular
> individual this year?
> 2.) The total I've given (or gifted) to a particular
> individual since I began giving a few years ago?
> 3.) The total I've given (or gifted) to anyone/everyone this
> year?
> 4.) The total I've given (or gifted) to anyone/everyone
> since I began giving a few years ago?
>
> If my giving or gifting does trigger an IRS tax, is the tax
> on:
>
> 1.) The total I've given (or gifted) to a particular
> individual this year?
> 2.) The total I've given (or gifted) to a particular
> individual since I began giving a few years ago?
> 3.) The total I've given (or gifted) to anyone/everyone this
> year?
> 4.) The total I've given (or gifted) to anyone/everyone
> since I began giving a few years ago?
>
> Or is the tax on any "new" amounts given after a particular
> threshold is met (e.g., $10,000) ?
>
> If it is, is that threshold per person/per lifetime, or for
> everyone per lifetime, or per person/per year, or for
> everyone per year?
>
> Or does the "lifetime" part have to do with my lifetime, as
> opposed to the lifetime of my recipient(s)?
There is no limit to how much a person can give to another
person. However, there are tax or filing implications at
certain threshholds.
You may give up to $12,000 per person per year, without any
gift tax or filing considerations. If the person is married,
double that. If you are married, and your wife agrees to the
gift, double that.
Gifts over $12,000 per person per year will require you to
file a gift tax return.
There is a lifetime exclusion (your lifetime) of $1,000,000
of gifts - over the $12,000 per person per year. Even though
you would be required to file a return for gifts over
$12,000, you would owe no tax until the lifetime exclusion
is exceeded.
The receiver of the gift does not owe tax, regardless of the amount.
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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