Gift deduction

[Mistee]

Anyone here know how the gift deduction works on the 1040 Federal Income Tax Form?

A division is going to be made from an estate to a couple of siblings and the expected amount to be given each sibling will be atleast $15,000. The division is being made by another sibling who will receive a share also, but she wants to divide a deceased sibling's share (that would have been hers), with her other two sisters so they can all share equally.

I have heard of gifts being given and I have sent away for the FORM 709 from the IRS, but I just thought someone could enlighten me as to how their experience with gift deduction/tax went.

This is knowledge I can use about gifting as I hear many people do it.

Just curious!

[MonkeyMama]

Gift and estate taxes are handled by the "gifter" or by the estate. If you receive a gift or assets from an estate, there is nothing to report as far as gift or inheritance tax.

The average person does not worry about estate taxes, so I would assume there is probably no estate taxes to worry about at the estate level either. (Threshhold is $3.5 Mil this year which means you could die with a net worth of $3.5 Mil and pay no taxes on the estate).

If the person were living they would have to deal with the gift tax return. There's usually not much to it.

[Mistee]

Sounds good! No worries there then.

Pretty much like a life insurance policy that one receives at the death of the benefactor....nothing to receive but the money!

Thanks!