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#175966

Federal gift tax refers to a tax that is paid by the IRS to the transfer of money or property between one individual and the other without providing a corresponding value in exchange. It is more applicable to the giver and not the recipient. The tax makes people not move their assets out of the reach of the estate taxes by bequeathing assets to others prior to death. Nevertheless, the majority of the individuals do not pay gift tax due to large exemptions and lifetime allowances. Gifts less than the annual exclusion do not need any filing and larger gifts only lead to a decrease in your lifetime gift and estate tax exemption unless it is completely utilized. Anything that is above the exemption is taxable.

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