To Liz, please:You recently stated that only people who have donated millions of dollars during their lifetimes are required to pay taxes.
With my children, who are the beneficiaries of my trust, I have a tendency to be giving. For instance, last year I gave my son a down payment on a property. My estate is likely around the $13 million lifetime limit due to long-held rental property assets.
Does this imply that I won’t have to record or pay taxes on contributions in any given year until I donate more than $13 million in cash, given that lifetimes don’t end until death and I intend to live to be 120?
Response: Not quite.
Any gift that exceeds the yearly cap, which in 2018 was $18,000 per recipient, must be reported on a gift tax return. Cash gifts are not required to be reported. You would still have to file a gift tax return if you had given your son a house rather than a down payment.
Your $13,610,000 lifetime gift and estate exemption is subtracted from any gifts that must be reported. You would have to pay gift taxes on any gifts beyond the annual limits once you used up that exemption. Reportable gifts will lower the portion of your estate that is exempt from estate taxes, even if you do not use the entire exemption. It may be prudent for you to see an estate planning lawyer regarding gift handling.
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Taking half your spouse s social security payment can be better than taking your own
To Liz, please:I was informed by my cousin who works as a bookkeeper that I may receive half of my husband’s Social Security rather than my own. My Social Security benefit was $1,300 when I started taking it at age 66. It was $3,295 when my spouse waited until he was 70. Does that imply that I might receive a $1,600 cheque each month?
Answer: Most likely not. Instead of the amount your spouse claimed at age 70, spousal benefits can be up to 50% of what he had earned by the time he reached full retirement age. Although you can check with Social Security, your own benefit is probably higher than what your spouse would have received.
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