Gift tax

[jbnjbn]

What is the name of your state? New York

My aunt recently died and left a sum of money to my father (the only beneficiary). My father would like to 'gift' me with $200,000. We were advised that he can only give up to $11,000 per year or be subjected to the 'gift tax'. I have searched high and low for the amount of taxes I would have to pay on $200,000, however was unable to find it. Grateful for this information (I understand my father would have to pay the tax and not me).

Thanks

 

[lazar627]

Hi there

I'm sorry to hear about your Aunt...
Yes, there is an $11,000 exclusion per year per donee. Therefore, total tax would be...
38,800+32% of the excess over 150,000

=51,380

Hope this helps! Have a nice day,

Brad

 

[Snipes5]

Wrong again.

No gift tax will be paid. A gift return must be filed, but the "tax" will be netted out against Dad's unified estate credit. It's a slight pain in the neck to have to file the form, but Dad won't have to pay any tax.

If possible, it would be better for Dad to give you $11,000 per year over time, so it doesn't affect his estate credit, and he doesn't have to file the form.

If Dad is married, and if you are married, he can actually give you a total of $44,000 per year before having to do a gift return.

That's $11,000 from him to you, $11,000 from his wife to you, $11,000 from him to your spouse, and $11,000 from his wife to your spouse.

Good luck,
Snipes

 

[jbnjbn]

Gift Tax

Thank you for your informative reply.

Can you please elaborate on the 'Unified Estate Credit'. Is the amount accumulative (i.e. does it consist of an accumulative amount of money given to various people or is accumulative per individual gift recipient)?

Thanks

 

[anteater]

It is the total of all gifts given in excess of $11,000 per year per individual.

For example, if I gave $20,000 per year to 5 individuals for 5 years, I would eat up $225,000 of the credit.

(20,000 - 11,000) X 5 individuals X 5 years

9,000 X 5 X 5 = $225,000