The “Other” Return: Gift Tax Returns Also Due April 18

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money gift2 150x150 The “Other” Return: Gift Tax Returns Also Due April 18Your gift tax return (Form 709), which covers taxable gifts made during 2010, is due at the same time as your individual tax return: on April 18 (thanks to “Emancipation Day,” a Washington, D.C. holiday celebrated this year on April 15).

That means taxpayers who gave more than $13,000 ($26,000 if married filing jointly) in cash, property or other assets to anyone other than a spouse must report the gift on their return.  If you received a gift, you don’t have to report it — the person who made the gift is responsible for paying any tax due.

Even if no tax is owed, any gift above the $13,000 limit must be reported on Form 709 so the IRS can offset it against your $5 million lifetime exclusion.  You must also report any gifts that are not a present interest (when beneficiaries don’t get access until later), no matter how small.

Married couples can combine their annual exclusions and lifetime tax-free amounts to give away up to $26,000 to whoever they want without having it count against the $5 million lifetime exclusion by gift-splitting.  Usually, couples must file a gift tax return and consent on each other’s return to gift-split. Gifts to a spouse do not need to be reported — unless your spouse is not a U.S. citizen.

If you have questions about how gifting can help you save on taxes and preserve wealth, contact our California estate planning law firm.

Get started by contacting our Orange County asset protection estate planning law firm as soon as possible.

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