The Perplexing Tax You May Never Have to Pay

Generous gifts can sometimes come with tax consequences. Get the answers to 10 frequently asked questions about gift taxes here.

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You’ve done well in life, and now you want to share some of your wealth with the people you know and love. Perhaps you want to help your children make a down payment on a home. Or contribute to your grandchild’s college savings plan. Or give a retirement gift to a loyal household employee.

But one concern that might be holding back your generosity is the question of whether you’ll have to pay federal gift taxes. It’s a topic that comes up in all kinds of discussions of giving. But here’s the good news: In general, the only people who have to worry about it are the so-called “one percenters.”

Still, even if you probably will never have to pay gift taxes, it’s worth getting the answer to common questions about this widely misunderstood IRS provision.

Written by Joelle Spear, CFP®, a financial adviser and a partner at Canby Financial Advisors (opens in new tab) in Framingham, Mass. She has an MBA with a finance concentration from Bentley University.

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC (opens in new tab) or with FINRA (opens in new tab).

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Joelle Spear, CFP®
Financial Adviser, Partner, Canby Financial Advisors

Joelle Spear, CFP® is a financial adviser and a partner at Canby Financial Advisors (opens in new tab) in Framingham, Mass. She has an MBA with a finance concentration from Bentley University.
Securities and advisory services offered through Commonwealth Financial Network®, Member FINRA/SIPC, a Registered Investment Adviser.