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How much money can i give my child a yr. tax free and does the child have to pay taxes on the money

Willcox, AZ |

My dad needs home care and I do this but am losing pay from work. people born in the 20's are stubborn and he refuses to let a stranger care for him. My Mom is there 24/7 but she gets wore out. I take care of both there meds, take them to doc. app. shopping etc... he can no longer drive he cannot even walk on OX 24/7

Attorney Answers 3


  1. The annual gift exclusion is $13,000. It is $26,000 per recipient if you are married and file jointly, and you make an election on your return. If you surpass this, the excess counts against your lifetime gift credit of $1 million. Unless you surpass this $1 million, you will not be subject to gift tax. When you die, this amount will also go against your estate credit. Once you surpass either of these credits, the estate tax is steep and is owed by the person gifting the assets.

    Christopher Larson


  2. Mr. Larson is correct that the annual exclusion amount is currently $13,000. This can be given to as many people per year as the donor (your father) wants without taking away from the lifetime exclusion. Currently the lifetime exclusion on gifts is $5 million. If the laws do not change, this amount will decrease to $1 million starting 01/01/2013.

    It sounds like you may need an elder law attorney rather than a tax attorney. An elder law attorney can help you with making gifts (or other asset transfers) while still making sure that your parents will qualify for whatever government benefits they can.

    This answer does not establish an attorney-client relationship, Moreover, this attorney is Licensed to practiced law ONLY in LOUISIANA and answers to questions from other jurisdictions or states are meant to provide only general information. Users should contact a local attorney in their jurisdiction or state.


  3. I concur with the previous responders: you definitely need to seek assistance from a reputable attorney who practices in the area of Elder Law.

    One additional thing you might want to consider, or ask your attorney about, is the possibility of preparing a contract for your father to pay you for the services you are providing. This would enable him to shift funds to you, although you would have to include this on your personal income tax return.

    LEGAL DISCLAIMER Ms. Willi is licensed to practice law in the state of OH and maintains an office in Franklin County. An OSBA board certified specialist in estate planning, trust and probate law, she is also authorized to handle IRS matters throughout the United States and is admitted to practice before the U.S. Tax Court. Her phone number is 614-890-0500 and her website is www.willilaw.com. Ms. Willi is ethically required to state that the response herein is not legal advice and does not create an attorney/ client relationship. This response is a form of legal education and is intended only to provide general information about the matter within the question. Oftentimes the question does not include significant and important facts and timelines that if known could significantly change the reply or make such reply unsuitable. Ms. Willi strongly advises the questioner to confer with an attorney in their state in order to ensure proper advice is received. By using this site you understand and agree that there is no attorney client relationship or confidentiality between you and the attorney responding. This site should not be used as a substitute for competent legal advice from a licensed attorney that practices in the subject area in your jurisdiction, who is familiar with your specific facts and all of the circumstances and with whom you have an attorney client relationship. The law changes frequently and varies from jurisdiction to jurisdiction. The information and materials provided are general in nature, and may not apply to a specific factual or legal circumstance described in the question or omitted from the question. Circular 230 Disclaimer - Any information in this comment may not be used to eliminate or reduce penalties by the IRS or any other governmental agency.