Happy Wednesday! We hope you’re all enjoying your holiday season and because I won’t be writing before the holiday we want to wish everyone a very Merry Christmas! FLP is having a wonderful holiday season and has participated in a number of different toy drives and donated to various charities. In the midst of the season of giving I thought I’d take a moment to discuss end-of-year gifting.
Every person has an annual gift exclusion of $14,000/year. This means:
1. You are permitted to gift up to $14,000/person to as many people as you would like each year;
2. If you’re married, you and your spouse can each gift $14,000, creating a potential $28,000/person gifting opportunity;
3. These are not considered taxable gifts and do not require you to file a gift tax return;
4. They are not included in your own taxable estate; and
5. Any growth in the value of these gifts is not included in your taxable estate.
As you can see, gifting can be a very effective way to reduce your overall taxable estate, but it is important for tax purposes not to exceed the $14,000/person/year limit. Gifting is also the perfect opportunity to see your loved ones enjoy some of their inheritance while you’re still alive.
If you are considering whether a gifting program is right for you please contact our officetoday.