gifting > $10,000 in one year

[diving]

Michigan: Is there any tax advantage to gifting > $10,000 in one year?

Thank you!

 

[loku]

What happens when you gift more than $10,000 in a year is that the lifetime exemption (currently $675,000, but scheduled to go up in future years) is reduced by the excess over $10,000. So as far as that goes, the combined gift and estate tax would be the same whether you gift over $10,000 in a year or not. Probably the only tax advantage is that the income from the excess would not be taxable to you and would not accumulate in your estate and therefore it would not be subject to estate tax. Over a period of years, that could make a significant difference.