Thursday, May 20, 2010

Can I deduct gifts (money) that I have paid to my children? if so how much?

How much can I claim on gifts given to our children for a deduction on our tax return?

Can I deduct gifts (money) that I have paid to my children? if so how much?
Gifts are neither taxable to the recipient nor deductible by the giver.





If you give a person over $12K in a year you would need to file a gift tax return. No tax would be owed, however, unless you have exceeded your $1M lifetime exclusion.
Reply:NOTHING.





And if you gave them more than $11,000 ($22,000 if you are married) you may end up owing a 50% gift tax.





Why would there be a deduction, in essence lowering your tax burden, because you choose to gift your children?


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