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Give the Gift of Peace of Mind
Part of estate planning involves deciding how much you want to give away while you’re alive. Many people get a lot of joy from seeing their loved ones receive cash gifts. In some sense, that’s infinitely more gratifying than letting the gifts occur after your death.
There two very easy ways to give gifts without incurring any gift tax, which coincidentally reduces the size of your estate and your estate tax liability, if applicable. Giving gifts can be a very effective double-edged sword for reducing possible estate taxes.
The 2 easiest ways to give in 2019are as follows:
1. Tuition and Medical Expenses
You may pay an unlimited amount of tuition and medical expenses for as many people as you want, so long as the funds are paid directly to the educational or healthcare institutions.
2. Annual Exclusion Gifts in 2019
In 2019, the annual exclusion for gifts is $15,000. You might recall that this is the same amount as the annual exclusion in 2018, but up from 2017’s amount of $14,000.
You may give up to $15,000 annually to as many individuals as you like. If you give more than $15,000 worth of cash or assets to a single individual, you must file a gift-tax return.
What if my spouse and I want to give away property that we own together?
You are each entitled to the annual exclusion amount on the gift. So, together, you can give $30,000 to each donee.
Speaking of Gifting … You may want to consider giving the gift of an estate plan to your family, whether it’s to a parent, a sibling, or a child (especially if that child has children of his or her own). Give the gift of peace of mind to those you love!