How much money can you gift without taxes?

[RSKY]

How much money can you give someone, or they give you, without them having to pay taxes on it?

To cover unexpected expenses that nobody could anticipate.

To a family member.

RSKY

 

[riptides]

How much money can you give someone, or they give you, without them having to pay taxes on it?

To cover unexpected expenses that nobody could anticipate.

To a family member.

RSKY

19k per person.

You and your wife - 38k.

 

[dougtrr2]

Actually, my understanding is 19K is the amount you can give without YOU having to file a gift tax return. I think it has something to do with you are allowed a certain amount to pass on to your heirs and the 19K limit per year is geared to those with estates that exceed the limit allowed by law to prevent them from giving it away before they die and "cheating" the government out of their potential cut.

As with all advice here, you are better off to ask the question of a competent professional.

Doug in SW IA

 

[riptides]

Frequently asked questions on gift taxes | Internal Revenue Service

Find common questions and answers about gift taxes, including what is considered a gift, which gifts are taxable and which are not and who pays the gift tax.

www.irs.gov

 

[MossRoad]

How much money can you give someone, or they give you, without them having to pay taxes on it?

To cover unexpected expenses that nobody could anticipate.

To a family member.

RSKY

There are some exceptions for medical bills and some other stuff.

 

[Snobdds]

Also, the giver pays the tax, not the receiver.

 

[murphy1244]

The general rule is that any gift is a taxable gift. However, there are many exceptions to this rule. Generally, the following gifts are not taxable gifts.

1. Gifts that are not more than the annual exclusion for the calendar year.
2. Tuition or medical expenses you pay for someone (the educational and medical exclusions).
3. Gifts to your spouse.
4. Gifts to a political organization for its use.

In addition to this, gifts to qualifying charities are deductible from the value of the gift(s) made

 

[hayden]

Here's my understanding. You need to consider both the giver and the recipient.

For the recipient, gifts are not taxable.

For the giver, the gift is also not taxable. However, if it's over the $19k/yr exemption, you need to file a gift tax return and the amount over $19k gets deducted from your federal estate tax exemption limit. So let's say you gift $1,019,000 to someone. That's $1m over the $19K limit. Say the federal estate tax exception when you die is $5m. Your exemption gets reduced by the $1m that you gifted in excess of the allowed limit, so your estate will only have a $4m exemption remaining.

 

[dstig1]

I believe there is one more detail on the medical and education expenses issue. Payments made DIRECTLY to the institution do not count against the gift limit. So if you pay their hospital bills DIRECTLY to the hospital, no problem. If you give the money to the person and then they pay the bills, that is a gift. Even though the net result is the same to us normal people.

 

[thclimer]

I have often wondered how the "lifetime estate tax exemption" works:

What is the Gift Tax Exclusion for 2025?

 

[RSKY]

Thanks for the info.

RSKY

 

[Tpondel]

When needing qualified financial and tax advice, always best to go to a tractor forum.

 

[riptides]

When needing qualified financial and tax advice, always best to go to a tractor forum.

Someone will always point out to seek professional help.

Others point out direct experience.

Is good to cover all bases and be open to others experiences.

 

[dougtrr2]

If you want to check and see how the process works I am willing to send you my full name and address so you can send me a check. Heck, I'll even drive there and pick up the check in person.

Doug in SW IA

 

[KennyG]

I max out on the allowable (non-reportable) gifts to my kids every year, not because they need it or because I think I will exceed the current estate tax threshold, but because the estate tax limits can be changed any year with the stroke of a congressional pen. At the rate debt is increasing I think it's only a matter of time before they start looking for any politically acceptable way to generate more government income.

 

[riptides]

I max out on the allowable (non-reportable) gifts to my kids every year, not because they need it or because I think I will exceed the current estate tax threshold, but because the estate tax limits can be changed any year with the stroke of a congressional pen. At the rate debt is increasing I think it's only a matter of time before they start looking for any politically acceptable way to generate more government income.

Better to give while alive, so many factors come into play. Control, satisfaction, pride, emotions, direct results,,etc. etc.

 

[RSKY]

When needing qualified financial and tax advice, always best to go to a tractor forum.

I have sought advice elsewhere. But this forum has a wide range of people on it and can give advice from different perspectives. Stay on here long enough and you will see everything discussed.

RSKY

 

[WinterDeere]

19k per person.

You and your wife - 38k.

And it can be $19k per giver per receiver. So if recipient is a family of four, you and your wife can give up to $38k to each of the four per year, before worrying about tax penalties. Since we're nearing the end of 2025, you and your wife could actually do up to $76k per recipeint over the next two months.

Do note that you will get hit with gift taxes if you exceed lifetime amounts, but those are up around $14M per person, so not an issue for most.

 

[RSKY]

And it can be $19k per giver per receiver. So if recipient is a family of four, you and your wife can give up to $38k to each of the four per year, before worrying about tax penalties. Since we're nearing the end of 2025, you and your wife could actually do up to $76k per recipeint over the next two months.

Do note that you will get hit with gift taxes if you exceed lifetime amounts, but those are up around $14M per person, so not an issue for most.

The $14M would not be an issue for us.

Your reply is what Mr. Google told me BEFORE I even posted the question to TBN. But, I have found that in a lot of different issues discussed here details come out that you cannot hear about elsewhere. Thanks for the reply.

RSKY

 

[CliffordK]

One of the exemptions is that the gift beyond the $19K limit can essentially be a loan against the estate. As long as the estate is less than $14M, or whatever it is when the person passes on, then one is OK. Although there may still be some state taxes owed.