How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Robin D. Your Own Question
Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 15312
Experience:  15years with H & R Block. Divisional leader, Instructor
Type Your Tax Question Here...
Robin D. is online now
A new question is answered every 9 seconds

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.


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.