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What is the IRS policy on gifts, will I have to pay a gift tax?
I recently had a baby. My Aunt and Uncle told me they are giving my daughter a piece of property as a gift. What is the IRS policy on gifts, will I have to pay a gift tax?
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Answers (1)
Estates and Gift taxes is one of the most complicated areas of the Internal Revenue Code. People use Gifts as a method of reducing the amount of inheritance tax that will have to be paid on their probate estate at the time of their death. Generally, the donor is the one that pays the gift tax if there is any gift tax assessed. In special arrangements, the person receiving the gift may pay the gift tax but that should not be done without consultation with a tax professional. The IRS has a schedule of how much a person can give per gift without triggering the gift tax. Gifts of $13000 or less are not subject to gift tax in 2009. If the gift your child receives produces income, you may have to file income tax for your child.
This an area of the law where professional help is necessary. You should consult with a tax attorney, and a CPA when dealing with gift tax issues.
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Posted by Edith Hull on 16 Feb 2010
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