The Motley Fool Discussion Boards
Financial Planning / Tax Strategies
|Subject: Re: re post above estate tax avoidence||Date: 11/19/2009 10:22 PM|
|Author: synchronicityII||Number: 107740 of 124951|
But as well, is there a a lifetime big # exclusion?
Or precisely, if someone gifts a 500,000$ piece of real estate,
are gift taxes due on ~489,000?
The gift tax lifetime exemption is 1M, but it is effectively tied to the estate tax lifetime exemption. Say you make a gift of 413K of real estate to one person. 13K is the annual exclusion, and your lifetime gift tax exemption is reduced by 400K. So you do not owe any gift taxes yet. However, your lifetime estate tax exemption is effectively reduced by that 400K. So when you die, your lifetime estate tax exemption is essentially reduced from 3.5M to 3.1M.
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