?Tis the season for gift giving and receiving the tax advantages that giving can bring. Remember that individuals can give up to $14,000 per person to as many people as desired while paying no gift tax. This amount doubles to $28,000 if the gift is accorded an individual and spouse. Often referred to as the annual exclusion, gifts above this amount count against lifetime exemptions from gift or estate taxes, which this year are $5.34M per person.
Gifts that pay someone?s education, dental or medical expenses (including health insurance premiums) won?t count against the annual exclusion or the lifetime exemption. Make sure, however, that any gifts made by check clear by December 31st, otherwise the gift may not be considered ?given? in 2014.
If you have questions about gifting or the preparation of the related IRA Form 790, it is a good idea to visit with your accountant or CPA.