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Ryan
Ryan, Professional Researcher
Category: Tax
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Experience:  I can find the answer to your tax questions fast and accurately!
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How much money can be given as a gift each year

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1-My parents want to give the children a gift of money but need to know what is the allowable amount without the recipient incurring income taxes. 2-Can the amount be allocated throughout the year or does it need to be one lump sum?
3-Is there a required form to complete?

Thank you for your question and welcome to Just Answer!

1. $12,000 is allowed per year, to each person
2. Lump sum or multiple payments is fine, as long as it does not exceet $12,000.
3. IRS form 709 only needs to be filled out if the amount exceeds $12,000.

This page gives a few more details, including other transactions with family members:
http://www.smartmoney.com/tax/homefamily/index.cfm?story=gifttax

I hope this helps! If so, please don't forget to "Accept" my answer!

Regards,
Ryan

Ryan, Professional Researcher
Category: Tax
Satisfied Customers: 2066
Experience: I can find the answer to your tax questions fast and accurately!
Ryan and other Tax Specialists are ready to help you

DearCustomer-

There is no income tax due from beneficiaries upon receipt of a gift regardless of the amount.

Donors can make gifts of up to $12,000 per calendar year without filing requirements. Thus your parents can give you (or anyone else for that matter) up to $24,000 without filing gift tax returns.

If taxable gifts exceed this amount, a gift tax return must be filed. There is no gift tax due until lifetime taxable gifts made exceed $1,000,000.