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What if I give more than the gift tax limit?
If you give more than the annual gift tax limit, you may have to file a gift tax return, but this does not necessarily mean that you'll owe taxes on the gift. The 2024 annual gift tax exclusion is $18,000. Sending a $20 bill with a graduation card? No need to sweat the federal gift tax.How much tax do you pay on a gift?
Taxpayers typically only pay gift tax on the amounts that exceed the allotted lifetime exclusion, which was $12.92 million in 2023 and is $13.61 million in 2024. Gift tax rates range from 18% to 40%. Of course, there are exceptions and special rules for calculating the tax, so check the instructions for IRS Form 709 for all the detailsWhat is the annual gift tax exclusion?
The annual gift tax exclusion is a set dollar amount that you may give someone without needing to report it to the IRS. The threshold is typically adjusted to account for inflation each year. The IRS announced that the annual gift tax exclusion will be $18,000 in 2024, up from $17,000 in 2023.