Alan S. wrote:You can do it, but it appears both spouses will have to file a 709 to elect gift splitting. The exception is for community property state residents making gifts from community funds, where the 50-50 split is automatic. The OP was from NJ which is not a CP state.
Additional gifts from either spouse would then exceed the 13k annual exclusion per donee, and the excess would become a taxable gift. Not currently taxable, but a reduction in the remaining unified credit.
When the Consenting Spouse Must Also File a Gift Tax Return
In general, if you and your spouse elect gift splitting, then both spouses must file his or her own, individual, gift tax return.
However, only one spouse must file a return if the requirements of either of the exceptions below are met. In the exceptions below, gifts means transfers (or parts of transfers) that do not qualify for the political organization, educational, or medical exclusions.
Exception 1. During the calendar year:
Only one spouse made any gifts,
The total value of these gifts to each third-party donee does not exceed $26,000, and
All of the gifts were of present interests.
Exception 2. During the calendar year:
Only one spouse (the donor spouse) made gifts of more than $13,000 but not more than $26,000 to any third-party donee,
The only gifts made by the other spouse (the consenting spouse) were gifts of not more than $13,000 to third-party donees other than those to whom the donor spouse made gifts, and
All of the gifts by both spouses were of present interests.
If either of the above exceptions is met, only the donor spouse must file a return and the consenting spouse signifies consent on that return.
Alan S. wrote:The entire issue is dependent on WHICH spouse made the gifts, since the 709 Inst. and IRS Regs are less than clear regarding donations from joint accounts.
1)Is the donor only the spouse who signed the check?
2) Or since the funding account was joint, is each spouse deemed to have donated 50% ?
1) If 1 above is true, will having both spouses sign the check avoid the 709?
There seems to be general lack of consensus regarding these questions with respect to non community property states. Therefore, you might look at the 709 as a conservative precautionary measure.
With respect to the 709 if filed, the OP suggested that additional gifts above the 26k would be made by the other spouse to the SAME donee. That would require a 709 for each spouse, but if the additional gifts were not made, then only the donor spouse must file the 709 and the other spouse could sign consent on that form.
masteraleph wrote:zotty wrote:I thought it was 13K for 2013?
Did this change?
[EDIT] I'm talking about the exclusion amount only.
Yes. It's indexed to inflation, and is $14,000 for 2013.
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