How much money can I give without paying taxes in 2017?
The old proverb “it is better to give than to receive” has much truth to it. Giving money to family and friends or your favorite charity can be immensely rewarding, both during your lifetime and upon your death. When you decide to give, there are ways in which to gift your funds so that you do not have to pay taxes on this amount. Our California estate planning attorneys at OC Wills & Trust Attorneys offer an overview on
Giving Tax-Free Annually
Any individual in California or across the country can give up to $14,000 a year to anyone or any number of people without having to pay a gift tax. Married couples in 2017 can give up to $28,000 if they elect to split their gifts. Gifts of this amount or under do not have to be reported, though you should keep records of the gift.
Gifting becomes more complex if you give over $14,000 a year. For large gift givers, a lifetime exclusion exists. You can gift up to $5.49 million per individual during your lifetime and not have to pay taxes on this amount. However, you will be required to report gifts that exceed the $14,000 annual limit, as gifts in excess of this figure count towards your lifetime limit.
Avoiding the Estate Tax
Currently, the federal estate tax still stands and wealthy individuals may face a 40 percent tax on their assets passed to heirs that exceed federal limits. President Trump has discussed eliminating the federal estate tax entirely, but thus far no definitive plans exist to abolish the hefty tax. Individuals with significant assets should take steps to shield their assets from the federal estate tax.
Proper estate planning can ensure you avoid the estate tax. Strategies could include the creation of certain trusts and