When you hear about the existence of the federal gift tax, you may wonder if it is possible to give tax-free gifts to your children. The answer is yes and no. A Look at the Gift Tax The gift tax exists to close a loophole. The estate tax was first implemented in 1916. Originally, there was no gift tax to go along with it. As a result, people who were exposed to the estate tax gave away assets while they were living to avoid the death tax. As a response, the gift tax was implemented a few … [Read more...] about Can I Give Tax-Free Gifts to My Children?
There is a unified tax exclusion in California that separates those who must pay transfer taxes from those who are exempt. The lifetime unified exclusion at the present time is $5.34 million in 2014. There is a gift tax and an estate tax. The two taxes are unified. As a result of this unification, the exclusion applies to gifts that you give while you are living, coupled with the value of your estate as it is being transferred to your heirs after your passing. It should be noted that there is … [Read more...] about Should You Use Your Unified Tax Exclusion in California While You Are Still Alive?