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** This article has been revised from its original version which was published on December 27, 2017.
The amount you can gift to any one individual in a particular year without reporting it to the IRS is always changing. In 2023, you can gift $17,000 as an individual or $34,000 as a married couple to as many people as you like without reporting it to the IRS. An estate planning attorney in New York can offer valuable insight before making gifts and explain how and when to report them when necessary. Russo Law Group, P.C. has estate planning and tax attorneys, and we can work with your trusted tax advisor.
How Gift Taxes Work
Should you give away more than the exclusion amount, you won’t necessarily have to pay taxes. However, you must file a gift tax return (Form 709). During an individual’s lifetime, the IRS allows $12.92 million ($25.84 for married couples) to be gifted before a gift tax is owed. This means even if you were to give over the annual gift tax exclusion amount in 2023 to a particular person, you would only owe taxes if you have given away more than a total of $12.92 million (or $25.84 million) in the past. As a result, filing a gift tax return is purely a formality for almost everyone.
Our clients often inquire about the following:
- The gift tax also applies to property, such as stock. If you give property worth more than $17,000 ($34,000 per couple), you must report it on your gift return.
- If a gift is made to a spouse, as long as the spouse is a US citizen, the amount is not usually subject to federal gift taxes. If your spouse is not a US citizen, only $175,000 may be gifted before reporting the gift must be reported to the IRS (in 2023).
- If a tax-deductible gift is made to a charitable organization, you don’t need to report it on the gift tax return. However, if you retain some interest in the gifted property, you must record the donation.
Depending on your situation, there are many other details regarding gift taxes. We are happy to discuss it with you. We are happy to discuss it with you.
Gift Tax Strategies with an Estate Planning Attorney in New York
If you are planning on making a large gift to an individual and have a question as to whether or not you will have to report this gift to the IRS, or if you will need to pay taxes on the gift, contact one of our knowledgeable tax attorneys before doing so. We will also work with your tax advisor to determine the best way to make the gift and meet your estate planning goals.
Contact the Russo Law Group P.C. to discuss your situation and concerns about gift taxes. Russo Law Group, P.C., has experienced estate planning attorneys in New York to offer tax planning advice. Mistakes are common and can be costly. We invite you to take advantage of our comprehensive website as well as our free seminars and webinars to learn more about how Russo Law Group, P.C. may offer you and your family peace of mind.