Elder Law Answers
How Much Can You Give Away and Still Qualify for Medicaid?
In order to be eligible for Medicaid, you cannot have transferred assets recently. Congress does not want you to move into...
Read moreHow Much Can I Give Away Each Year?
- February 5th, 2017
Q
How much money can I gift to my children and grandchildren each year without tax penalties to me or to them?
A
The annual gift tax exclusion for 2016 and 2017 is $14,000. This means that you can give away $14,000 or less to any one individual (anyone other than your spouse) and not have to report the gift or gifts to the IRS. If you give more than $14,000 to any one person, you will have to file Form 709, the gift tax return. But just because you file a Form 709 doesn't mean you necessarily owe any tax; this depends on your past gift-giving history. The IRS allows you to give away a total of $5.49 million during your lifetime before a gift tax is owed (this figure is for 2017). This $5.49 million exclusion means that even if you have to file a Form 709 because you gave away more than $14,000 to any one person last year, you will owe taxes only if you have given away more than a total of $5.49 million in the past.
For more information on the gift tax, go here: https://www.elderlawanswers.com/will-you-owe-a-gift-tax-this-year-6069.