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How much money can be gifted to a child without taxation?

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Finance - Taxes

If an older person sells their house and wants to give the proceeds to one of their offspring, I believe the offspring must pay an inheritance tax. I would like to know what percentage that tax is and also what amount can a person gift to another person before it is taxed. And can money be gifted every year at a certain amount without taxing?

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  • how much can be gifted in 2012

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  1. the tax lady on Sep 26, 2011 reply

    If they are alive, it’s NOT an inheritance tax, it’s a gift tax.

    If one person gives another person more than $ 13,000 in one year, they must file the gift tax form 709. The amount above $ 13K is taxable, but due to the combined estate/gift tax exclusion, the giver probably doesn’t have to write out a check. (The amount is added back to the estate when they die to determine if there is an estate tax.)

    Each year starts the $ 13K amount over again.

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