Gift Budgeting Guide

If person makes gift of gift of money or property to anyone not their spouse or dependent They could be required to pay gift tax. federal tax is minimum of 18% but may reach as high as 40 percent on specific amounts of gifts. It is responsibility to pay this tax is usually on person who gave gift rather than recipient of donation. Although recipients arent subject to immediate tax implications however, they could be required to be responsible for capital gain tax on sale of their property later on. Some gifts are not exempt from taxation However, some gifts are. Certain types of gifts are completely free of tax. These include: Payments for tuition to schools & educational expenses Charitable donations Medical costs Contributions to politics The spouse & dependents can receive gifts. Gift tax is not able to have major impact on budgets of many Americans due to … Read more