Annual Gift Tax Exclusion

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Annual Gift Tax Exclusion

The value of the gift(s) an individual or married couple may give in a year without being subject to the gift tax. The amount of the annual gift tax exclusion varies from year to year but is always over $10,000. In general, payments for medical, educational, and political purposes fall under the annual gift tax exclusion no matter how much they are, as do gifts to one's spouse.
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They filed timely gift tax returns that consistently claimed annual gift tax exclusions.
Finally, the Second Circuit rejected annual gift tax exclusions for over 40 checks a decedent wrote on her deathbed to family and friends.
Commissioner,[2] which has been construed by some to allow annual gift tax exclusions based on a contingent or "naked" Crummey power.
INDIVIDUALS OR COUPLES CANNOT USE THEIR ANNUAL gift tax exclusions to shelter QPRT transfers from tax.
The Service continues to attack the availability of annual gift tax exclusions for transfers to trusts containing Crummey(19) withdrawal rights.
The estate treated the interests of the contingent beneficiaries as qualifying for 16 annual gift tax exclusions, which the IRS disallowed on the grounds that the decedent and the beneficiaries had an understanding that the latter would not exercise their withdrawal rights.
Consistent with AOD 1996-010, the IRS argued that substance-over-form doctrine should apply to deny 16 of the annual gift tax exclusions claimed.
The IRS stated that it would not contest annual gift tax exclusions for Crummey withdrawal rights when the trust instrument gives the power holders a bona fide unrestricted right to demand immediate possession and enjoyment of trust income or corpus, but would deny the exclusions if the withdrawal rights are not in substance what they purport to be in form.
2503(b) annual gift tax exclusions attributable to the children, the IRS disallowed the exclusions attributable to the grandchildren, finding what the grandchildren's withdrawal rights were not present interests.
Consequently, the decedent was allowed annual gift tax exclusions for those gifts in 1985, and in 1986 for the subsequent gifts.
In effect, the intermediate recipients were no more than vehicles to use to obtain annual gift tax exclusions on transfers that were ultimately meant to be reconveyed to family members.
5 (1991), the Tax Court upheld the annual gift tax exclusions claimed by the settlor of an irrevocable inter vivos trust for gifts made to contingent trust beneficiaries.

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