A CPA in Tampa Explains the Federal Gift Tax

Federal Gift TaxAmong the most complex parts of the Internal Revenue Code in the U.S. are the sections dealing with the federal gift tax. This doesn’t apply to gifts you give and receive during the holidays or for birthdays. A gift in this sense means the transfer of ownership of property, including significant amounts of money, without receiving something of corresponding value in return. This is not to be confused with the estate tax, which is incurred when someone dies. The federal gift tax is applicable, in most cases, if the giver is still alive.

A CPA in Tampa from Reliance Consulting, LLC, can help you figure out whether you owe federal taxes on a gift given or received. In general, the one doing the giving is responsible for paying whatever tax might be owed. There are circumstances in which the recipient might be responsible for the tax, but those are generally subject to interpretation – it’s often difficult to figure out without the help of a trained CPA. In general, most gift transfers that are less then annual exclusion of $13,000 incur no tax. In fact, even gifts of more than the annual exclusion might be exempt, thanks to the lifetime estate basic exclusion of $5.12 million. There are other exemptions and potential deduction, as well.

As you might imagine, it can be hazardous to try to decipher the intricacies of the federal gift tax without the aid of an experienced CPA from Reliance. Contact us today to learn more, or for answers to any of your estate planning questions.

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