Gifting son down payment on condo
I want to give my son $40,000 as downpayment on a condo. This is his first home purchase. Can I give him this amount and avoid paying taxes on it for him or myself? I have three checking accounts that he can sign checks on and credit union account. The Closing date is nearing.
Terry Says
You can gift him $40,000 — and no one pays any taxes at this point. You can give it to him out of any account, or multiple accounts. That doesn’t matter. And I hope he appreciates this gift!
Everyone is allowed to give anyone $14,000 a year and not file a gift tax return. So if you are married, you could consider it a gift from you and your spouse — a total of $28,000 exclusion on this year’s gifting availability.
Ask your accountant about filing a gift tax return –no taxes involved, just documentation. At this level, it’s probably not necessary. This gift only comes into play at your death, and only if your estate is over the $11 million (current) level. At your death all assets, including retirement accounts, and all previous annual gifts over $14,000 per year, are included back into your estate to determine if any estate taxes are due.
