gift tax benefits

[MarleneM]

If I give my two adult sons $10K each does it reduce my taxable gross or net amount for the year? I am in Arizona, they are in California.

 

[ALawyer]

What? The gift does NOT come off your INCOME at all. The $10,000 is from your capital and to the extent it (and the total value of all other gifts you made to the same person during the calendar year) does not exceed $10,000 there is no need to file a gift tax return or take a charge against what will be (on 1/1/2002) a $1 million lifetime exclusion amount you can gift during your lifetime and/or leave by Will or Trust before estate and gift taxes are incurred.

 

[MarleneM]

GIFT TAX

[Thank you, I was hoping for some way to reduce my tax obligation and also help my sons out. Guess this is not the way to do it.

 

[JeffreyHawkins]

2 Questions:
1) Who is liable for the "Gift Tax" . . . the person giving the money, or the person receiving the money, . . . or both?
2) If a person receives $9999 cash as a gift in a given tax year, do they have to pay any taxes on that gift?
3) In terms of what constitutes "The tax year in which the gift was made" is it when the money is given (date of check) or when the money is deposited in the recipient's account? (Example, I wrote a $9999 check to my sister on 31 DEC 01, but it will not be deposited in her account until 3 JAN 02 . . . is this a gift in year 01 or year 02 for tax purposes?

Thank you!