"Annual Gift Tax Exclusion Amount for 2010, 201167
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By frankellis
What is the Annual Gift Tax Exclusion Amount?
Each year you are able to give away money or property in the form of a gift. These gifts will be nontaxable as long as they are below the gift tax limit amount allowed by the IRS.
Gift Tax Limit 2010 Amounts
If you file as single, you may give up to $13,000.00 to each individual you choose to gift. This annual gift tax exclusion amount applies to each gift, not to a grand total of all gifts.
If you file married, then you may gift up to $26,000.00 to each individual you choose to gift. This annual tax exclusion amount applies to each gift, not to a grand total of all gifts.
There Are a Few Guidelines to Ensure Your Gift is Nontaxable:
The gift amount cannot exceed the annual gift tax exclusion amount during one calendar year.
If you have paid for someone else’s education expenses, then no matter how large the amount, this will remain nontaxable.
Your gift will remain nontaxable if you gave it to your spouse or a political organization.
You may need to file a gift tax return under certain circumstances. To file a gift tax return you will need to use Form 709.
If you have given gifts that are larger than the gift tax limit amount, then you will be responsible for the tax on the remaining gift amount. If you are married, then you will need to share the amount of that tax that is due on the gift amount.
If you are the recipient of a gift, then you will not need to report this on your return as long as it is considered a true gift and not any type of payment. If the gift produces income such as stock or a business, then you will need to pay tax on the income earned.
Learn more about the annual gift tax exclusion amount here: Understanding The Federal Gift Tax Exclusion Laws."
Link: http://hubpages.com/hub/Annual-Gift-Tax-Exclusion-Amount-for-2009--2010