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Richard, Tax Attorney
Category: Tax
Satisfied Customers: 55308
Experience:  29 years of experience as a tax, real estate, and business attorney.
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Florida resident passed away, checking account,mutual fund

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Florida resident passed away, checking account,mutual fund in decedent and son's name.According to Florida law joint ownership not probateable. Son want to distribute balance of checking /mutual fund with siblings. An accountant said cut certified checks and he would file forms for state/federal and there would beno taxes incurred? Is this correct. Total of assets $400,000.
Welcome! My goal is to do my very best to understand your situation and to provide a full and complete answer for you.

Good afternoon. Your accountant is correct. These amount paid to the siblings would be considered gifts. But, there would be no taxes on the transfers. A recipient of a gift does not pay gift tax. And, from the son's standpoint as a donor, there should also be no gift tax consequences. Each donor can give $14,000 per year per person under the annual gift exclusion. In addition to that, each person has a $5,120,000 lifetime exemption....which means a person can give a cumulative amount of up to $5,120,000 in gifts without incurring gift tax....the donor must file a gift tax return to let the IRS know how much of the lifetime exemption is being used, but there will be no gift tax until cumulative gifts have exceeded the $5,120,000.

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Customer: replied 4 years ago.

So this would reduce my lifetime gift transfer amount by $300,000 or what ever the final amount ends up being? Thank you, XXXXX XXXXX want to make sure on the tax side prior to cutting the checks.. Regards, David

Thanks for following up. That is correct. You first get to take advantage of the $14,000 per donee annual gift exclusion which doesn't count against your lifetime limit.
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