If you give away money or property during your lifetime,
you may be subject to the federal gift tax. Here are
some gift tax facts the IRS wants you to know.
* Though the general rule is that gifts are taxable,
there are many
exceptions to the rule. Gifts that are
not taxable include
those that don't exceed the annual
exclusion amount for
a given year ($13,000 for 2012),
gifts to your
spouse, charitable gifts, gifts to
political
organizations, and payments for the tuition
or medical expenses
of someone that you make directly
to the medical or
educational institution.
* You and your spouse can make annual gifts of double
the exclusion amount
even if just one of you owns the
property being
gifted. Such a split gift requires the
filing of a gift tax
return even if half of the split
gift is less than
the annual exclusion.
* Generally, the person who receives your gift is not
taxed on the value
of the gift. If any tax is due,
you the donor are
responsible for it.
* You cannot take a tax deduction for gifts you make,
except for gifts to
charity. To be deductible, charitable
gifts must be made
to IRS-approved organizations;
gifts to individuals are not tax-deductible.
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