Tax-Smart Gift Ideas for Your Loved Ones

– Taxpayers can transfer up to $16,000 per recipient each year free of gift taxes using the annual exclusion.
– Married taxpayers can split their gifts, allowing them to transfer up to $32,000 per recipient each year.
– Gifts to a spouse are not subject to gift taxes under separate marital deduction rules. – Both spouses must consent to gift splitting if it is being done.
– A gift must be a “present interest” gift in order to qualify for the annual exclusion from gift tax.
– Even taxable gifts may not result in a tax liability because of a tax credit that wipes out federal gift tax liability on the first taxable gifts made in a lifetime, up to $12.06 million for 2022. 1. Taxpayers can take advantage of tax deductions and credits to reduce their tax liability.
2. Changes in tax laws and regulations can affect how individuals and businesses are taxed.
3. Tax planning is essential for maximizing tax savings and minimizing potential penalties.

Plan Now to Make Tax-Smart Year-End Gifts to Loved Ones