Gift Tax Exemption Killer Professional Advice
In 2009, the IRS allows a tax exclusion for an annual gift amount of $13,000 that you give to your spouse or to your child. For 2008, the gift tax exemption is $12,000.For married taxpayers who file a joint return the annual gift tax exemption is $26,000.
Gift Tax Exemption Requirements
If you give more than the annual gift exclusion, you have to pay taxes. However, there are other exclusions that may limit the gift tax you may be held liable for.Gift tax exemption may not apply for some of the gifts you offer to your spouse. If the spouse is not a U.S. citizen, certain limits may apply. In addition, there is an unlimited exclusion for payments made for medical or school expenses, if you pay these expenses directly to those institutions.If you give more than the annual tax exclusion amount, you have to file a gift tax return. You will be liable for tax gift only if you give a very large amount. The IRS allows you to give $1,000,000 during your lifetime without paying gift taxes. If the amount of gifts you give during your lifetime exceeds the limit above, the excess of it may reduce your estate tax.