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How Much Cash Can Be Gifted to a Family Member Annually?

Estate PlanningIt is important to note that an individual can gift up to $14,000.00 annually to a family member, or to as many family members or friends as they wish without incurring any gift tax liability. This annual exclusion amount of $14,000.00 is valid for 2014, and can be $28,000.00 for a married couple should they wish to gift to family members.

If an individual exceeds this annual exclusion for gift tax purposes, there is a lifetime exemption, which for tax year 2014, is $5,340,000.00 This is the same figure for both estate and gift tax purposes. However, this is a combined amount, and should not be doubled in calculating one’s gift or estate tax exposure. The proper form that should be completed when preparing the gift tax return is IRS Form 709. If one exceeds the lifetime gift tax amount, there gift tax liability could run approximately 40%.

Should you wish to discuss various forms of estate planning, please contact an experienced estate planning attorney at the Law Offices of Michael W. Alpert by calling (631) 225-4603 or contact us via email today.