[mdrobbin]

Are gifts double taxed to the donor if the donor gives a gift subject to gift tax? For instance, if I give my brother a gift of $15,000 (over the $13K exclusion)… I already paid taxes on that income. Am I paying an additional tax on top of my income tax for the $2K over the $13K exclusion?

Hope that’s not a dumb question… brain is fried from studying

FAR - 2012 - PASSED (YAEGER)
AUD - 2012 - PASSED (YAEGER + NINJA NOTES)
BEC - 2012 - PASSED (YAEGER + NINJA NOTES)
REG - 2013 - PASSED (YAEGER + NINJA NOTES + NINJA AUDIO)

ETHICS - 2013 - PASSED

DONE!!! Thank you A71 for all the support! Hiya!!!

[Anonymous]

You would pay a gift tax now on the $2,000 if you plan on having a very wealthy estate. The exclusion for estate tax in a lifetime is $5 million and people who expect to have an estate greater than that might pay gift taxes so it doesn't build up when they die and leave the wealthy estate with a large tax liability.

[Noct]

Yes, the giver is double taxed, but understand that gift tax is effectively a prepayment of estate tax, and it is subject to the same exclusion of $5 million per benefactor (cumulatively over their lifetime), so in your example, the giver would pay no gift tax. The $13k you are referring to is the amount that can be gifted each year without including it in the $5 million exclusion.

FAR - 79 - 07/2012
AUD - 65, 78 - 11/2012
BEC - 76 - 11/2012
REG - 78 - 01/2013
ETH - 98 - 01/2013

Material: Wiley books

[mdrobbin]

Thanks for the clarification!

FAR - 2012 - PASSED (YAEGER)
AUD - 2012 - PASSED (YAEGER + NINJA NOTES)
BEC - 2012 - PASSED (YAEGER + NINJA NOTES)
REG - 2013 - PASSED (YAEGER + NINJA NOTES + NINJA AUDIO)

ETHICS - 2013 - PASSED

DONE!!! Thank you A71 for all the support! Hiya!!!

[mrspanda11]

Hi, is the exclusion of $5MM the same for 2013? Taking the test at the end of May. thanks!

[TPratt]

The annual exclusion for 2013 is $14,000 per donee per donor, and the lifetime exclusion has increased to $5,250,000.

REG - 87
BEC - 81
AUD - 80
FAR - 81 AND DONE!!

[Author]

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