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Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 13316
Experience:  15years with H & R Block. Divisional leader, Instructor
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Is there any way I can pay off $80,000 on my daughter's

Customer Question

Is there any way I can pay off $80,000 on my daughter's college loan balance without incurring taxes?
Submitted: 1 year ago.
Category: Tax
Expert:  Robin D. replied 1 year ago.

Hello,

You can pay off her loan balance and you would not be taxed for doing so. By making the payment for her you would be making a gift and that gift would be more than the annual allowed amount ($14,000) but as long as you have not used up your lifetime allowance for gifts ($5.43 million) you would not pay tax.

You would need to report the gift (form 709) but on that form you claim the first $14000 under annual allowance and then the remaining under Unified Credit (lifetime allowance) leaving you no Gift tax to pay.

Please advise if you need more information or rating in a positive way is acceptable.

Your daughter is not taxed on the gift, neither does she even have to report.

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