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Gifting

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The Silver Lining – Transferring Assets in a Down Economy

The current economy has created a great opportunity for individuals to transfer assets, and future appreciation of such assets, with little to no transfer tax. This opportunity is created by the depressed asset values and historic low applicable federal interest rates (“AFRs”), which are the minimum interest rates, set monthly, permitted by the IRS. (The current AFR for a loan with a term under three years is 0.19%, three to nine years is 1.17% and over nine years is 2.63%.)

The federal gift tax is imposed on all lifetime gifts that exceed the annual exclusion from gift tax (currently $13,000 per person), and the federal estate tax is imposed on the value of all assets and property that an individual owns at the time of death. Each individual, however, has an exemption of $5,120,000 against the gift and estate tax.

A gift during life of an appreciating asset can reap

Methods of Giving

Methods of Giving

November 16, 2011

Authored by: Stacie J. Rottenstreich and Karin Barkhorn

As we approach Thanksgiving and the holiday season many of us turn our thoughts to gift giving to family and loved ones. The Federal gift tax system allows us some opportunities to do such “gifting” in a tax free manner. A few states impose independent state gift taxes, so an expert in your state should be consulted before considering any of these gifting transactions. Each individual has a total of $5,000,000 he can give away during his lifetime before owing any gift tax. However, there are several gifting opportunities which do not count as part of your $5,000,000 lifetime total. It is as if the Federal tax law has deemed them non gifts. Present interest gifts of $13,000 in 2011 and 2012 to any number of recipients are not subject to gift

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