Gift tax

Forum|Forum|1 year ago
December 18, 2024
2 replies
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Hello,

I want to give each of my 2 kids a gift of roughly $60,000. I understand that since my husband and I file jointly, we can jointly give each kid $36,000 with no taxes, or $18,000 each. Is that right?

However, I was under the impression that the balance of $24,000 would be exempt from taxes as long as i have not gifted the lifetime limit. And fill out a form (can’t remember the number). But, in the other blogs I saw here, it looks like there would be a tax due on the $24,000.

Can anyone clarify this for me?

Not A Product Question

Best answer by M-MTax

I want to give each of my 2 kids a gift of roughly $60,000.

Strategy = You can give each kid $36,000 (combined) before the end of the year (2024) without filing a 709 gift tax return. You can then give each kid up to $38,000 (combined) in January of 2025 without filing a 709 gift tax return.

As mentioned, you won't owe any tax even if you exceed the annual exclusion unless you are over the lifetime exemption ($13.6 million).

Hal_Al

Employee

"Gift Tax" is somewhat of a misnomer. Even though a gift tax return (Form 709) may be required, very few people ever actually pay federal gift tax. The purpose of the gift tax return is usually only to document a reduction in the allowable estate tax exemption.
See https://turbotax.intuit.com/tax-tools/tax-tips/Tax-Planning-and-Checklists/The-Gift-Tax-Made-Simple/INF12127.html

M-MTaxAnswer

I want to give each of my 2 kids a gift of roughly $60,000.

As mentioned, you won't owe any tax even if you exceed the annual exclusion unless you are over the lifetime exemption ($13.6 million).

xmasbaby0

Employee

Gifts given to family members, friends or other individuals are not deductible. Gifts received are not taxable to the person who received the gift, and are not entered on a tax return.

If your gift exceeds the yearly limit ($17,000 per individual) imposed by the gift tax rules, then you will need to complete a Form 709 gift tax form and send it to the IRS, although it is very unlikely that you will owe any tax. In 2024 that yearly limit will increase to $18,000.

TurboTax does not support Form 709. It is not an income tax form and would not be included as part of an income tax return.

Here is a link to the form:

https://www.irs.gov/pub/irs-pdf/f709.pdf

https://turbotax.intuit.com/tax-tips/estates/the-gift-tax-made-simple/L5tGWVC8N

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

M-MTax

If your gift exceeds the yearly limit ($17,000 per individual) imposed by the gift tax rules, then you will need to complete a Form 709 gift tax form

You should update your file. The $17,000 annual exclusion applies to gifts made in 2023.

The amount rose to $18,000 in 2024 and will rise to $19,000 in 2025.