08 Sep I was given a gift of $45K. How much do I owe in taxes?
Q. I got a gift of $45,000. How much will I owe in taxes?
— Still working
A. We’re glad to hear you got a windfall, and we have good news for you.
A recipient of a gift never pays federal gift tax.
It’s the donor who is responsible for the tax, said Neil Becourtney, a certified public accountant and tax partner with CohnReznick in Holmdel.
But, he said, it’s rare for donors to incur any federal gift tax liability.
That’s because first, there is an annual exclusion of $15,000 per donee.
“Assuming you received a gift from one individual, this would have resulted in a taxable gift of $30,000,” he said. “If a married couple makes gifts, they can elect gift splitting whereby they would each be entitled to annual exclusions.”
If you received the $45,000 from a married couple, such as your parents, and if they elected gift-splitting, they would each have made a gift to you of $22,500, less a $15,000 exclusion for each. That would leave them each with a taxable gift of $7,500, he said.
New Jersey does not impose a gift tax at all, he said.
Email your questions to moc.p1601031938leHye1601031938noMJN1601031938@ksA1601031938.
This story was originally published on Sept. 8, 2020.
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