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Tax on Gifts

Saddle Brook, NJ |

If I give a monetary gift to anyone, how much that should be to avoid taxes. And if that gift is returned to me will I be giving any taxes on it?
Also, how much can money can I deposit in my account during the year to avoid taxes including montary gifts?

Attorney Answers 4

Posted

Until December 31, 2012, you can leave up to $5 million. You would need to file a gift tax return, but there would be no gift tax on it. After January 1, 2013, you could leave $14k per person.

Hurry to your tax and estate attorney to take action NOW.

I hope this helps!

Ron Cappuccio

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Posted

Right now the exempt amount is $14,000. That is, any gift to any individual for less than $14,000 does not require you to pay gift tax. If a gift is returned, you lack one of the elements of a gift, which is acceptance. I do not understand the deposit issue.

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Asker

Posted

Thank you John for the answer. What do you mean by lacking element of acceptance? The entire issue is that my friend is buying a house and want me to gift him $13,000.00. He will return this money to me but for returning the money what should we do to avoid tax issues ? By deposit I meant that when he returns my money I will be depositing it to my account. If I deposit that $13,000 and make additional cash deposit during the entire year how will that impact me? Greatly appretiate your assistance.

Posted

Some confusion here. The annual present interest gift from any donor to any Donee is $14,000 per year. But a donor's lifetime exemption is $5,120,000, Which is over and above the annual present interest gift exclusions. gifts to trusts generally do not qualify for this $14,000 annual exclusion.

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Posted

"If I give a monetary gift to anyone, how much that should be to avoid taxes. And if that gift is returned to me will I be giving any taxes on it? "

Technically, no. But if you expect a return "gift," then it is a loan as far as the IRS is concerned.

"Also, how much can money can I deposit in my account during the year to avoid taxes including montary gifts? "

You cannot deposit any money into a bank account to avoid paying taxes. If it is income, then it is income regardless of whether you deposit it in a bank account. It is income when you earn it. Where you choose to put your post-tax income is your choice.

Christopher Larson
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