WHAT IS THE ANNUAL GIFT TAX EXCLUSION?

FederalTRANSFER TAXES

There is an estate tax in the United States, and there is

also a gift tax

These taxes are unified

AND RATEExclusion

There is a unified lifetime gift and estate tax exclusion

In 2014 the exclusion is $5.34 million

This is the amount that you can transfer tax-free

The maximum rate is 40 percent

Gift Tax Exclusion

Annual

In addition to the unified lifetime exclusion, there is also an annual

gift tax exclusion

You could use this exclusion to give tax-free lifetime gifts

If you stay within the annual exclusion amount, these gifts would not reduce the amount

of your available unified lifetime exclusion

$14,000 Per Person

The annual gift tax exclusion is $14,000 per person in 2014

You can give up to $14,000 within a calendar year to any number of

gift recipients tax-free

To reiterate, this exclusion sits apart from the unified lifetime

exclusion

EstateTAX EFFICIENCY

The annual gift tax exclusion can be used to gain estate

tax efficiency

You could transfer a significant amount of money tax-free if

you use this exclusion over an extended period of time

GIFT TAX EXCLUSIONS

Additional

In addition to the annual gift tax exclusion and the unified lifetime

exclusion, there are two additional exclusions

There is an educational exclusion that allows you to pay school

tuition for others tax-free

You can use the medical exclusion to pay medical

expenses for other people in a tax-free manner

LEARN MORE ABOUT FEDERAL TRANSFER TAXES

If you would like to learn more about federal transfer taxes,

contact our firm to schedule a consultation

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