How are Gifts Taxed?
ฝัง
- เผยแพร่เมื่อ 29 เม.ย. 2021
- Explanation of how gifts are taxed; both from the perspective of the gift giver and the gift recipient. Discusses annual gifting limits, lifetime exclusions, gift tax returns and much more!
Links in this video:
Retirement Planning Insights - www.tenonfinancial.com/newsle...
Taxes in Retirement - / taxesinretirement
#GiftTax #FinancialPlanning #TaxPlanning
DISCLAIMER: This video is only helpful hints and education. It is not specific tax, legal or investment advice. Before considering acting on anything you see in this video, first consult with your tax, legal or investment advisor. While the information expressed in this video is believed to be accurate, neither Andy Panko, CFP®, RICP®, EA nor Tenon Financial LLC make any guarantees to its accuracy.
fantastic video, as usual from Tenon
Great video and explanation of gifting. I appreciate your guidance.
Amazing detailed explanation. Very helpful. Thank you.
Thanks!
I just spoke with an accountant and she said that this video is wrong and terribly misleading since all gifts are taxed without exception. All gifts to spouse or children is from money left over after paying income tax
Income is taxed (unless specifically excluded). What you choose to do with your income after paying tax on it is up to you. For example, if you use it to buy things in a state that doesn’t charge a sales tax, would you say those purchases are taxed???
You are a true professional. Thank you!
Thank you!
Very well done Andy!
Thank you!
Andy....fantastic video! I appreciate how you fully explain things and give examples and don't sketch the high points. One question though....In order to actually take advantage of the deceased spousal unused exclusion (DSUE), is it true that an estate tax return must be filed within a certain time after the death of the first spouse, even when not otherwise required by the IRS because the size of the deceased's estate is less than the Basic Exclusion Amount (BEA)? Thanks.
Yes, I believe that is correct...you don't automatically get the DSUE; a return needs to be filed within a certain amount of time to get it
Question on Gift Tax Form 709.
How does one report gifts following the death of a spouse?
Instructions (2023 & 24 pg 7) state if splitting with spouse all gifts must be split and only gifts given while married can be split.
Example - I split our gifts up to the date of her death but I continued to gift following her death.
Hey Andy great video. could you in the future do a video on form 709?
Thank Kevin. Good suggestion, I'll put it on the list!
I'm homeless but, this video helped to reduce my fears of taxes.
When doing a split gift how is that secured in terms of documentation if the money is coming from a joint bank account with the spouse? Great video along with all your others.
If the gift from the spouses to the same recipient is more than $15k (but under $30k), each spouse should separately give a gift. For example, if spouses are giving $20k to a child from a joint bank account, that $20k should be split up such that it's two payments of no more than $15k each. Spouse A could write a check for $15k from the joint account and Spouse B could write a check for $5k from the joint account. Basically, even though it's a joint account, each spouse needs to independently give their portion of the gift
Gifts received are not taxable? Someone said funds received from a GoFundMe should be interpreted as gifts; someone else said such funds are taxable. Which is correct?
Thank you for the information. May I inquire if I need to pay tax when I, as a green card holder, gift $350k to my husband who is a U.S. citizen? Additionally, I reside in California. Would there be any state tax implications? Thank you
I gave my daughter some land I owned to her. Estimated market value is 59,200 (on property tax statement), After subtracting 15,000 it comes to 44,200. Looking at the table for gift taxes, this would mean I would have to pay over 8,000 in gift taxes. Do you have any suggestions on what I can do to not have to pay this gift tax?
Did you already gift away more than your lifetime limit of $12,060,000? Only after you gift away more than that do you have to actually pay tax on gifts you give. Otherwise, if you gifted away more than $15k to a single person last year, you'll have to file a Form 709 to report the gift. But you won't have to pay tax on it (Form 709 is what's used to track how much of your lifetime gift limit you've thus far used up)
I gave my son $125K as a dawn payment to buy a house. The money was transferred directly from my bank account to the title company. Now, 2 months later his old house got sold and he's returning the money ($125K) to me. Do I have to report anything to the IRS?
I can't formally advise what you should or shouldn't do. Considering how close together the two transfers of $125k were, I'm frankly not 100% sure what the official IRS stance would be on this. But on the surface, the series of events you described appears to be one of two things: 1) you gifted your son $125k and he separately gifted you $125k, or 2) you gave an interest-free loan to your son and he repaid it.
If option 1 is the proper way to view it, you and your son technically each should file a gift tax return to report that you gave $125k to one another. No one will owe any tax on anything, but the "gifts" would nonetheless have to be reported.
If option 2 is the proper way to view it, then I think you would have had to charge your son interest (there is a concept of "imputed" interest whereby the IRS doesn't allow interest-free loans between people like this and would assume you should have been receiving interest - and claiming it as income - at a fair market level). But then if you didn't actually get any interest from your son, I think the amount of interest you SHOULD have received may be treated as a gift to him. And that gift size would be below the annual gift exemption limit such that nothing would need to be reported.
But ultimately, my official answer to you is "I don't know." Because I really don't!
Are you talking only about non retirement funds? Can I gift from my IRA?
Yes, sorry; this is in the context of gifting already-tax assets. You can't gift directly from an IRA. You can make donations to qualified charitable organizations directly from an IRA (if you're over 70 1/2, via something called a Qualified Charitable Distribution). But you can't gift directly to non-charities. You basically have to first take a normal distribution, and then you're free to do with that money whatever you please, including giving it away to friends, family, etc. The distribution is still taxable just the same as any other reason for taking a normal distribution.
If I gift 11 million in 2025 then die in 2026 (exclusion amount is 5 million) you is the extra 6 million accounted for?
Is the exclusion amount triggered when I actually gift the money or is itt when I file at end of my life?
It’s when you gift it. The IRS has thankfully clarified that those who gift more than what the future lower limits will be will fall under the limits that were in place at the time they made the gifts.
If I add my best friend in my second hand car title along with my name, as joint tenants with right of survivorship, is this considered a gift? If so If full car fair market value is 17000$, then 17000$ is gift amount? Or 17000$/2 is gift amount?
Yes, you’re functionally gifting that person half of the ownership and value of the car. If the car’s current fair market value is $17,000, the value of the gift is $8,500
@@RetirementPlanningEducation If I add my best friend in my primary home title as joint owner with rights of survivorship then my gift amount is (current fair market value of my home) / 2 as we both are like joint owners. Is my analysis correct? Just to be same page out of my diligence. And any years we exceed annual yearly gift tax amount, we just only need to fill IRS Form 709 and do not worry about paying gift tax as long as we did not exceed life time estate exclusion amount which I guess is $12.92 million in 2023.
@@boyboy-xe6rx correct
@@RetirementPlanningEducation Thank you soooo much very sincerely from bottom of my heart. Very grateful.
@@RetirementPlanningEducation Apart from submitting IRS form 709, is there any other form to officially let IRS know we would like to deduct anything over annual gift exempt amount from life time exclusion amount? Or IRS 709 handles everything?