Tampa Gift Taxation Attorney

If you plan to leave a substantial inheritance to members of your family, you might decide there is no reason to wait until you are dead. You can simply give your money and property away during your lifetime. Before taking such action, however, you may need to consider the potential federal gift tax implications.

While most Florida residents will never end up actually paying the gift tax, it can become an issue with larger estates. A qualified Tampa gift taxation attorney can review your situation and advise you accordingly. Knudsen Law is a full-service Florida estate and probate firm that advises clients on a wide range of gift and estate tax matters.

How Does the Federal Gift Tax Work?

To be clear, just because you gift someone money, that does not mean you need to run out and file a federal gift tax return. The IRS is not interested in that $50 bill you put in your grandchild’s birthday card. If you are disposing of millions of dollars worth of property, however, then you may need to take a step back and consider the potential for gift tax liability.

The gift tax is a levy on transfers of money or property that you make to other people without receiving full value in return. Under federal law, you only have to report gifts to the IRS if they exceed either your annual or lifetime gift tax exclusion. The annual exclusion is the amount of gifts you can give to a person each year. In 2024, the annual exclusion is $18,000. This is a per-person exclusion. So if, for example, you have five children, you could give each of them up to $18,000 in property each year without triggering any gift tax liability. And if you are married, you and your spouse can combine this annual exclusion and give each child $36,000.

Even if your individual gifts exceed the applicable annual exclusion, however, you are still likely to avoid gift tax liability if you have not exceeded your lifetime gift tax exclusion. The lifetime exclusion mirrors the federal estate tax exclusion, which for 2024 is $13.61 million. In other words, as long as the total amount of property that you gift during your lifetime does not exceed $13.61 million, you do not owe any federal gift tax. There are other exclusions that can further reduce your liability, such as gifts made to your spouse, a political organization, or payments made for someone else’s education or medical care.

Let Our Tampa Gift Taxation Attorneys Help You

If your gifts exceed all of the available gift tax exclusions, you could find yourself facing a hefty bill–up to 40 percent of 40 percent of any excess gifts. So it is important to take steps now to minimize–and hopefully avoid–any gift tax liability. Our Tampa gift taxation lawyer will be happy to discuss your options with you. Contact Knudsen Law today at (727) 398-3600 to schedule a consultation.