This changes. At one time it was $10,000 but it is higher now. You'll need to check with a CPA or other tax specialist to make sure you get the right amount.
The amount any one person can give another person in 2011 without having to file a gift tax return is $13,000. If you are married, you and your spouse can each give that person $13,000 in a year. If you go beyond the $13,000 limit, it doesn't mean you'll have to pay gift taxes- everyone gets a $5,000,000 lifetime exclusion from gift taxes. There is no maximum amount if you are paying the other person's medical expenses directly.
The amount any one person can give another person in 2011 without having to file a gift tax return is $13,000. If you are married, you and your spouse can each give that person $13,000 in a year. If you go beyond the $13,000 limit, it doesn't mean you'll have to pay gift taxes- everyone gets a $5,000,000 lifetime exclusion from gift taxes. There is no maximum amount if you are paying the other person's medical expenses directly.
Yes- it applies to children giving to parents. You can give up to $13K to a parent without filing a gift tax return. Also you can pay a parent's medical expenses directly up to any amount without filing a gift tax return.
@Jon - doesn't this have an adverse impact on the recipient's ability to keep anything over Medicaid's max limit? If that isn't disclosed, isn't fraud involved? I have similar potential situations.
Anybody listen to Clark Howard's radio show. He says there is a way around the $13,000 gift limit. The person making thee gift can write up a loan document for the amount over $13,000. The document should specify the amount of money & the interest rate. Specify the term of the loan to be 12 months with the interest due & payable at the end of the loan. The person receiving the money should sign the loan document.
At the end of the term of the loan, the person "lending" the money forgives the interest due.
Take care,
Carol
I'll make some calls to find out.
Have a great day!
Gale
At the end of the term of the loan, the person "lending" the money forgives the interest due.