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In 2020, you can give up to $15,000 to someone in a year. 

You can make a gift of cash or other property to any individual each calendar year. 

If you give more than $15,000 in cash or assets like stocks, land, cars, etc) in a year to any one individual, you need to file a gift tax return. This doesn't mean you have to pay a gift tax, only that you have to report the gift to the IRS via Form 709.

Generally, the following gifts are not taxable gifts:

  • Gifts that are not more than the annual exclusion for the calendar year
  • Tuition or medical expenses you pay for someone (the educational and medical exclusions)
  • Gifts to your spouse
  • Gifts to a political organization for its use
  • Gifts to qualified charities (a deduction is available for these amounts)

Importantly, the annual exclusion is per individual recipient and not the sum total of all of your gifts. 

If you are married, both you and your spouse can separately give up to the annual exclusion (even to the same person) without making a taxable gift.

Most gifts are not subject to the gift tax and most estates are not subject to the estate tax. 

For example, there is usually no tax if you make a gift to your spouse or a qualified charity or if your estate goes to your spouse or qualified charity at your death. If you make a gift to someone else, the gift tax does not apply until the value of the gifts you give that person is more than the annual exclusion for the year.

The person receiving the gift generally doesn’t need to report the gift to the IRS either.

For more info, refer to the FAQs about Estate and Gift Taxes on the IRS website.

 

Source: IRS.gov