Estate Planning, Probate & Elder Law Attorneys

» Freddie and Fannie subpoenaed

» Loans And The Credit Crunch
I’m sure that most of you have been following the credit crunch news. Yesterday the Fed once again lowered rates, but not to the expectations of most of Wall Street. The current credit crunch in my opinion will make the 80’s farm savings and loans crisis look innocent. Bail outs of large [...]

» IMCA seeking third-party accreditation

» Should I Get The Auto Warranty?
This is a great time of year to buy a car. Salespeople are desperate for Christmas money, dealers want to close out the year with a bang, and the lot managers need to make room for new models. I’m going shopping later for a car with a friend and I’d like to get [...]

» 2008 Year-End Gifting Made Easy

One of my most well-received posts was this one, on "year-end gifting made easy."

Evidently the Federal Taxes Weekly Alert has calculated that the gift tax annual exclusion will go from $12,000 (right now) to $13,000 in 2009. Based on this, it seems like time for an update:

Next year the annual gift tax exclusion will increase from $12,000 to $13,000. The gift tax exclusion is the amount that you can give to as many people as you wish, per year, without paying gift tax or even needing to file a gift tax return.

If you are in a situation where you'd like to make gifts, the end of the year (and the start of the next year) is a good time to do it. Three quick, easy scenarios:

1. You and your spouse have three grown children. (Each child is married and has one child of his or her own.) You and your spouse each give $12,000 to each child on December 31, 2008 and $13,000 to each child on January 1, 2009. You have just given away $150,000 without having to pay gift tax or even file a return.

2. Same facts as in 1., but you also make the same gifts to each child's spouse. That's another $150,000 that you've given away without having to pay gift tax or even file a return.

3. Same facts as in 2., but you also make the same gifts to your three grandchildren. That's another $150,000 that you've given away without having to pay gift tax or even file a return.