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One time gifts person to person and tax deduction (updated)
Posted on 6/10/16 at 6:28 pm
Posted on 6/10/16 at 6:28 pm
What is the maximum amount I can gift to someone without them paying taxes on the gift and still allow me to use the gift as a tax deduction?
Is that the same if gifting someone a material object like a vehicle?
Are the laws governing that state-specific or purely Federal
Is that the same if gifting someone a material object like a vehicle?
Are the laws governing that state-specific or purely Federal
This post was edited on 6/11/16 at 9:42 am
3
Posted on 6/10/16 at 6:47 pm to Bleeding purple
I think the current limit is 14,000 per person, so if you wanted to stretch it you could give 14k then your wife could give 14k to the same person and still be under the annual limit
However the gifting exclusion only prevents them from having to pay income tax, it does not allow you to deduct that amount from your tax liability, unless of course they are considered a charitable organization, or so is my understanding
Yes a material object follows same guidelines
This is for IRS only, not sure about state specific
However the gifting exclusion only prevents them from having to pay income tax, it does not allow you to deduct that amount from your tax liability, unless of course they are considered a charitable organization, or so is my understanding
Yes a material object follows same guidelines
This is for IRS only, not sure about state specific
This post was edited on 6/10/16 at 6:49 pm
Posted on 6/10/16 at 6:55 pm to Bleeding purple
You and your spouse can make a gift of 14,000 each to someone (28,000 total). Just make sure it is the only gift from you to them this year (could cause tax implications).
And no, you can't use it as a tax deduction.
And no, you can't use it as a tax deduction.
This post was edited on 6/10/16 at 6:56 pm
Posted on 6/10/16 at 6:57 pm to Tigerpaw123
The recipient of a gift never pays income tax on it, the exclusion prevents the gifter from having to pay gift tax.
The gifter does not get a tax deduction for giving a gift.
The gifter does not get a tax deduction for giving a gift.
Posted on 6/10/16 at 7:27 pm to Tigerpaw123
quote:
However the gifting exclusion only prevents them from having to pay income tax, it does not allow you to deduct that amount from your tax liability, unless of course they are considered a charitable organization, or so is my understanding
I was partly wrong, the 14K exclusion has nothing to do with the recipient paying income tax, the IRS states that a received gift is not taxable, however the 14k prevents the DONOR from having to pay a gift tax, which is total BS, the donor already paid tax when they made the money the first time.
But nevertheless the donor never gets a deduction for gifting, save to a charitable organization
This whole exercise is just an example of how screwed up our tax code is and how it continues to bleed from the ones who do to provide for those that don't
Posted on 6/10/16 at 8:40 pm to Bleeding purple
Like they said you don't get a deduction. I think the only reason it makes sense to do large gifts is if you are loaded and older...you have to withdraw your IRA's... but don't want to have huge estate tax when you die... Then start gifting family members yearly to liquidate some without govt stealing it from you
This post was edited on 6/10/16 at 8:41 pm
Posted on 6/10/16 at 8:48 pm to DaBeerz
As said its $14,000 per person to any person. So if you are married and your kid is married its possible to gift $14k x4 per year, but if you are single and want to gift to a single person it is $14k.
The more important question is what are you trying to do? I would state that first because there may be other options.
The more important question is what are you trying to do? I would state that first because there may be other options.
Posted on 6/11/16 at 8:17 am to baldona
Have a good friend whose vehichle broke. There are at the moment flat broke with 7 kids, living out of an RV. The vehicle was the tow vehicle.
I have a similar vehichle we are considering upgrading any way. I want to gift it to him. The value is about 6 k.
I am pay a hefty tax burden and don't want to lose the trade in value of the vehichle if possible and was hoping to use the gift as a write off.
Maybe I can gift to church and have church give to him?
I have a similar vehichle we are considering upgrading any way. I want to gift it to him. The value is about 6 k.
I am pay a hefty tax burden and don't want to lose the trade in value of the vehichle if possible and was hoping to use the gift as a write off.
Maybe I can gift to church and have church give to him?
Posted on 6/11/16 at 9:52 am to Bleeding purple
Be careful with the Church idea. Is how college scholarship monies were handled by some years ago until the IRS caught up and said ....no go, no more
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