Do Gift Recipients have to Pay Taxes?
Do Gift Recipients Have to Pay Taxes?
Transcript:
Hi this is Wes Coulson and this is your estate planning and elder law minute. One of the questions that we get frequently relates to whether there are taxes on gifts. Quick answer is, that 99% of the time, no. That’s because of two exemptions. One of which most people know a little about, and that’s the annual exemption which right now is $14,000 per giver to receiver. The one that most people aren’t aware of is the lifetime exemption it’s the same thing that covers the state tax, right now that’s 5.34 million dollars. Basically what that means is that as long as the total of what you give away during your lifetime or when you die is less than 5.34 million dollars, there’s not going to be a tax. Fortunately for 99% of the population that takes care of it. Do know, that if you are going to make gifts during your life and use part of that unified exemption, you need to file a gift tax return, and let the IRS know, but there won’t be a tax. Thanks.
