What Is the Gift Tax Limit?


Quick Answer

The annual gift tax exclusion limit for 2014 and 2015 is $14,000 per individual, according to the IRS. The federal gift tax annual exclusion limit can be changed by the IRS any given year.

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What Is the Gift Tax Limit?
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Full Answer

Each donor is entitled to give another person $14,000 per year without paying tax. Therefore, a married couple can give $28,000 total to an individual during 2015, donating $14,000 from each spouse, Forbes explains. Amounts given in excess of $14,000 are subject to federal gift tax.

The federal gift tax is directly tied to the federal estate tax, according to Forbes. The federal estate tax exemption for 2015 is $5.43 million. An individual can give gifts in excess of the annual gift tax exclusion limit and not pay gift tax by counting the excess gifts against his federal estate tax exemption. This allows an individual to give money now and not pay gift tax, but it increases the amount of federal estate tax that is paid after his death.

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