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Author: irasmilo Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121565  
Subject: Re: paying niece' tuition, gift tax? Date: 5/29/2014 2:49 PM
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I am paying my niece's college tuition, and expenses this year. She is an international student, so likely will exceed 50K total this year.

I understand that if I include my wife, both of us can gift $14,000, that is total $28,000 this year.

So, with 50K tuition, room and board, how do I file my tax in 2015? Do I have to pay some taxes for this that exceeds $28,000 limit?


If you make the payments directly to the school, the tuition cost is exempt from gift tax reporting. Payments for other expenses are still subject to gift tax reporting if the total (with other gifts to the niece) exceeds $14K ($28K if given jointly with your wife).

Gift tax returns are filed separately from your income tax return. Even if you are required to file a gift tax return, you won't owe any gift tax unless you've already exceeded your lifetime gift tax exemption. See the instructions for Form 709, US Gift (and Generation-Skipping Transfer) Tax Return, www.irs.gov/pub/irs-pdf/i709.pdf, for all the details.

Don't forget to check whether your state has its own version of the gift tax.

Ira
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