Gift Tax

Did I need to file a federal gift tax return? Now that the federal estate tax, under the new 21st Century Act, raised the taxable estate to $11.0 million and over, many will opt to not file – that’s not to mention the current gift tax exclusion increase to $15,000 per person.

But wait! Is there another reason to file?

The Financial Agent: That’s especially a consideration for an individual who has served as an agent under a Power of Attorney.

The Executor: The concern relates to questions about timing under the Medicaid lookback period of 5 years.

The Beneficiary: A nonrelative named as a beneficiary under a Will may need proof of the past donative intent of a decedent.

The IRS: The failure to file a federal gift tax return may result in penalties for failing to file the return. Oh, and don’t forget it is a way to establish income tax basis for personal and real properties.

Uneven or surprise distributions gifts, without a legacy letter that expresses a person’s intent, may call into question those expenditures.

So is there a reason to file a federal gift tax return? Yes!