08/02/2019 by balloubedell 2 Comments
To gift money to friends or family or not?
Many people want to give cash to friends and family, but are afraid they will have to pay tax on the gifts. Good news- it turns out that it has never been easier to give away money. Each person has the right to give $15,000 per person, per calendar year, with NO reporting to anyone. This means you can give $15,000 to your son, $15,000 to his wife, $15,000 to each grandchild, $15,000 to your neighbor, etc. There is no limit to the number of people. But, if you give more than $15,000 to any one person, you do have to report it through an informational return. This return would merely state the gift and counts toward your ability to give a total of $5.7 million away (2019 amount in Maine) during your life, and double that at the Federal level. See blog post about estate tax. If you are like most people, you will be well under these exemption amounts and you never have to worry about triggering any taxes. So, if you want to help someone out with a down payment on a house, or whatever else and you think you can afford it, talk to your accountant first, but chances are that taxes will not be due on gift.
-Kathryn Bedell, Esq.