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Question

Are gifts to family members tax deductible (example - a $3000 gift to a family member that is having financial problems?

Submitted: 47 days and 21 hours ago.
Category: Tax
Value: $15
Status: CLOSED
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Optional Information

State/Country relating to question: North Carolina

Already Tried:
I live in NC but my sister lives in Wisconsin - want to give her a gift due to the fact she is experiencing a financial challenge.

Accepted Answer

Hello XXXXXX,

Unfortunately, gifts you make to anyone other than a qualified charitable organization are never tax deductible. In fact, to the contrary, donors of gifts can be responsible for paying gift taxes if they exceed their allowed lifetime exemption. This is not likely to happen in most cases, since each individual is allowed to give gifts of up to $1 million in their lifetime. But once gifts exceed that amount, the donor actually pays gift tax at a rate of 45%.

A gift you make to your sister would not be tax deductible for you, nor would it be taxable income for your sister.

If this was helpful please press the Accept button.

Thank you XXXXXX and let me know if you have more questions. I am happy to help you with whatever I can.



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Expert: Merlo
Pos. Feedback: 99.8 %
Accepts: 
Answered: 10/6/2009

Accountant

25+ years tax consulting. Specializing in returns for US citizens living abroad

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