Know the Rules for Making Gifts

9:48 pm Tax Planning

money gift 2 e1316545217983 Know the Rules for Making GiftsThe timing of making year-end gifts is important because a transfer of property is only counted as a gift once a donor has unconditionally relinquished all control over it.  Here are the rules concerning gifts:

Gifts by Check – the check must be cashed or deposited into the recipient’s account by Dec. 31 to count as a 2013 gift, so if you have given a gift via check, be sure the recipient follows through by cashing or depositing the check before the end of 2013.

Gift of Securities – the securities must be physically transferred into the recipient’s account by year-end.

Large Gifts – gifts above the $14,000 annual exemption count toward your lifetime exemption, which is $5.25 million for 2013.  You should consult with your estate planning attorney about the tax consequences of gifting more than $14,000.

Charitable Gifts – if you are making a donation by check, it must be mailed by Dec. 31.  If you are making a donation via credit card, you must also make it by Dec. 31, even though you will not pay for it until 2014.

To learn ore about how gifting can benefit your estate, contact our Costa Mesa law firm.

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