As of 2014, taxpayers must pay a gift tax after they have gifted more than $5.43 million of excess money during their lifetimes. Parents can gift $14,000 per year to each of their children.Continue Reading
A husband and wife can gift $28,000 per year to each child. A taxpayer must file a gift tax return if he gives more than allowed per person each year, but does not have to pay a tax until a gift tax exclusion maximum is reached.
For example, a single person with one child can gift the child $14,000 in one year. If the parent gifts $30,000 in one year, the additional $16,000 is filed on a gift tax return. Each taxpayer is currently allowed a gift tax exclusion of $5.43 million in a lifetime before he must pay a gift tax. Most people never have to pay gift taxes.
The gift giver is required to file the gift tax return and pay the tax if one is required. Sometimes, if the giver does not pay the taxes on the excess amount, the Internal Revenue Service may try to recover the amount from the gift recipient. The gift giver can give as many gifts of up to $14,000 per year as he wishes. For example, a person can give 100 friends $14,000 in one year with no gift tax return required. Gift giving is not a large source of revenue for the IRS.Learn more about Taxes