If your parents have substantial assets and want to reduce their tax liability, a tax free gift to their children may help reduce the value of their estate while they're alive. They are allowed to give a maximum gift of $12,000 per year to each child without incurring a gift tax. If those same gifts were given after your parents' deaths, and they were subject to estate taxes, their value would shrink by at least 39 percent.
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Tax-Free Annual Gifts to Children
By Caring.com Community Member, Tim
- ID:
- 7347
- First Published:
- 12-Nov-2007
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- Summary:
- Tax free gifts to children can help your parent reduce their tax liability. Parents may give a maximum of $12,000 per year to each child without incurring a gift tax.
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