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rraffel: "Hi All - Hope I can get some help with the following scenario...

Parents want to provide a gift of approx 250k to their child (Child is married with a child of their own). This will be done in the form of a lump sum check."

I will let the tax pros address your primary point, but your question seems to ignore split gifts and that the child is married.

PF - Parent Father
PM - Parent Mother
SW - son's wife
GC - son's child

PF can give 13k to Son and PF can give 13k to SW - total 26k
PM can give 13k to Son and PM can give 13k to SW - total 26k, for a grand total of 52 k in 2010, without gift taxes.

January 1 is less than 3 months away, so the whole exercise can be repeated then, too.

IOW, 104k without gift taxes could be accomplished within three months.

Also, depending upon the intended use of the funds, gifts by PF and PM could also be made to GC, but the Son and SW would not be free to use those funds as they wish.

Regards, JAFO
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