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Getting comfortable with making large gifts

1/10/2012 Articles

Published on North Bay Business Journal

We are currently in a unique tax environment allowing for $5 million of lifetime gifts (per individual, $10 million per married couple) to be made tax-free. If no action is taken by the government, the gift tax exemption will return to $1 million beginning Jan. 1, 2013.

As people are being encouraged to make gifts to take advantage of the significant exemption available, many are concluding that they are not comfortable transferring significant sums of money to children or grandchildren at this time. While it is important not to let tax motivations control planning and gifting decisions, it is also important not to let an opportunity pass without consideration of all the ways to take advantage of it. In order to assist in making the decision whether to gift, following are recommendations for productive ways to make large gifts to family members.