Gift giving can be an important tax planning strategy. But before you write checks, learn the rules. Here are two of them:
  • The person receiving your gift does not have to file a return, no matter the amount.
    • When you give gifts up to $14,000 ($28,000 for a married couple) to any one person within a calendar year, you don’t have to file a return either.
    • Other non-reportable gifts include amounts you pay for anyone’s tuition or medical bills, as long as you write the checks directly to the school or health care facility. That’s true even if the cost exceeds $14,000.
  •  When a return is required, you may not owe gift tax. Under present tax law, up to $5.49 million of gifts made during your lifetime can be shielded from tax. This is in addition to the $14,000 per donee annual exclusion.
Call us at (215) 706-0800 about other rules that apply to your situation. We’ll be happy to discuss tax-wise strategies and help you make the most of your gift giving.