How much can you give without incurring gift tax?

Answer 1

$11,000

Amount above has been upped, and has many ways to be applied.

Gifts aren't taxable under the income tax laws, but rather under the Gift Tax rules. That is, the tax is one the one that gives it, not the one that receives it. The gift tax has a number of options you can normally drive a truck through...as shown below. (One caveat, in family situations you need to consider the lifetime gift exclusion for estate taxes, but it rarely becomes an issue).

If you gave any one person gifts in 2007 that are valued at more than $12,000, you must report the total gifts to the Internal Revenue Service and may have to pay tax on the gifts. The person who receives your gift does not have to report the gift to the IRS or pay gift or income tax on its value.

Gifts include money and property, including the use of property without expecting to receive something of equal value in return. If you sell something at less than its value or make an interest-free or reduced-interest loan, you may be making a gift.

There are some exceptions to the tax rules on gifts. The following gifts generally are not taxable and do not count against the annual limit:

• Tuition or Medical Expenses that you pay directly to an educational or medical institution for someone's benefit
• Gifts to your Spouse
• Gifts to a Political Organization for its use
• Gifts to Charities

If you are married, both you and your spouse can give separate gifts of up to the annual limit of $12,000 to the same person without making a taxable gift.

Alternatively, with consent from your spouse, you can make a gift of up to $24,000 ($12,000 x 2) to the same person without making a taxable gift. This is commonly known as splitting gifts between spouses. Essentially, it means a gift by you or your spouse to a third person can be considered as made one-half by each of you provided there is consent by both spouses.

Now, if your adult child has a spouse, and or children, how much money can you give that isn't GIFT TAXABLE?

Or, maybe it was a say 50K loan you gave to that kid, (with interest of "love and affection"), principal payable at 12000 a year...that you can then gift each year. My question is does this mean per person? Could you give 1200 to each one of your children without having to pay a gift tax?

It would help if you had dates on these replies, because I believe it's now at least $13,000 per person per year...and I believe it's soon to be $15,000 per person per year.