02 Jan / Client from Canton Tax Question
A Canton tax question from a client. The client asks. How much can I gift to my only child before the end of 2014?
A individual is allowed to receive up to $14,000 from any one individual during 2014. So a daughter can receive $14,000 from her father, $14, 000, from mom, and $14,000 from her brother. for a total of $42,000 in this example.
A person receiving the gift does not have any reporting responsibility to the IRS when receiving a gift from a family member. The family member providing the gift does not have a reporting requirement to the IRS unless the gift is in excess of $14,000. Gifts in excess of the $14,000 limit are reportable to the IRS on Form 709. And although they are reportable, they are not necessarily taxable.
Additionally, gifts made directly to educational institutions or to pay direct medical bill do not count against the annual gift exclusion.
Tax advice contained in this communication, including attachments and enclosures, is not intended or written to be used, and may not be used for the purpose of (i) avoiding tax related penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any tax-related matters addressed herein.