CCH Learning Center

Description:

This course covers gifting strategies that can be used to reduce the potential estate tax bite that impacts many individuals. Even with the increased exemption amount that each person can transfer estate-tax free ($1.5 million in 2005) the performance of the stock market, rising real estate values, and other factors have combined to push many taxpayers over that tax-exempt threshold. For these individuals, it is important to understand the benefit of gifting and ways to maximize this transfer strategy. While some of the material discussed in the course is basic, it is important enough to review and expand upon.

Discussions include:

• common exclusions that will help reduce tax liability;
• using the lifetime exemption amount;
• exclusions for direct payment of medical or educational expenses;
• transferring property to a qualified tuition plan;
• special situations associated with gifts left to a spouse or charity;
• the timing required for gifts;
• audit risks for gifts; and
• penalties and risks of gifting.