ach year millions of return. Gifts that are recognized
Americans give a gift to by the government include
other individuals that they property and money.
know. Gifts can be considered
anything from a new vehicle, to a There are a number of exceptions
trip, to a piece of land. A gift to the gift tax imposed by the
tax is a tax that is imposed when Internal Revenue Service (IRS).
an individual gives away a Gifts that are given to a spouse
certain amount of gifts that are are not considered taxable.
considered valuable. Another gift tax exclusion
includes gifts that are used for
According the Internal Revenue education or medical expenses.
Service (IRS), an individual who This gift tax is often applied
gives a gift or a combination of when a close family friend or
gifts to one person that is family relative pays a portion of
valued at over eleven thousand the college tuition expenses or
dollars must pay a gift tax. The medical expenses of someone they
Internal Revenue Service (IRS) know. Gifts that are given to a
does not require that the charity are also not considered
individual who received the gift taxable. Individuals can donate
pays the gift tax. The only their land, their vehicle, or
individual who is responsible for money to an established charity
reporting and paying the gift tax and it will not be considered
is the person who gave the gift taxable. away. A gift is when something is href="http://www.taxhelpdirectory
given away at no cost. The .com/taxstratagies/"
Internal Revenue Service (IRS) title="http://www.taxhelpdirector
defines a gift as something that y.com/taxstratagies/"
is given away without receiving target="_blank">anything of similar value in color="#001000"
size="-2">http://www.taxhelpdirec In addition to the eleven
tory.com/taxstratagies/> restriction, individuals are also
subject to a lifetime gift tax
Individuals who give a taxable limit. That lifetime limit is one
gift that exceed eleven thousand million dollars. Individuals who
dollars are required to file a exceed one millions dollars in
Form 709: United States Gift (and gifts in any number of years are
Generation-Skipping Transfer Tax required to start paying taxes on
Return). The Form 709 can be any more gifts that are given in
obtained by contacting the the future. This means that even
Internal Revenue Service (IRS) or if an individual gives a gift
by printing the form off of the that is less than eleven thousand
Internet. It is also possible to dollars, the next year they are
obtain an online form by visiting still required to pay a gift tax
the website of the Internal because they exceeded their
Revenue Service (IRS) at href="http://www.irs.gov"
title="http://www.irs.gov" Giving another individual or
target="_blank">color="#001000" property is a great way to reduce
size="-2">http://www.irs.govt>. This form comes in a PDF an estate tax later on in life.
format that allows individuals to In addition to offering a number
enter in their information using of tax benefits, a gift also
the computer, and they can print allows individuals to give back
off the completed forms to be to their children, family,
mailed to the Internal Revenue friends, or community.
Service (IRS).
About the Author:
Gray Rollins is a featured writer for the TaxHelpDirectory.com. To learn more about the gift tax and for answers to more tax questions, visit our site.
