During 2012, Mr.and Mrs.Z decide to begin a program of inter vivos giving to their children, their children's spouses, and their grandchildren.The couple has one married daughter, one married son, and six minor grandchildren.What is the maximum total amount that Mr.and Mrs.Z may give to those mentioned in 2011 without incurring the Federal gift tax?

Question

Quizplus · Accepted Answer

The maximum total amount that Mr. and Mrs. Z can give without incurring the Federal gift tax depends on the annual exclusion amount for gifts in 2011, which was $13,000 per recipient. Mr. and Mrs. Z can each give $13,000 to each of their children, their children's spouses, and each grandchild without incurring the gift tax. They have 2 children, 2 children's spouses, and 6 grandchildren, making 10 recipients in total. Each can give $13,000 to each recipient, so the calculation is 2 donors * 10 recipients * $13,000 = $260,000.