Gift Tax Exclusion

[Snaggletooth]

Man X and Wife Y have a son A and daughter-in-law B.

X can give A $12,000
X can give B $12,000
Y can give A $12,000
Y can give B $12,000

Is this correct? Some have thought a total of $24,000 could
be transferred and be exempt. The above scenario totals
$48,000.

[jimmcg]

This is correct. $12,000 per donor to donee.

[Roland Slugg]

I concur ... 4 at $12,000 each.

[Snaggletooth]

Increase in Basis

Thanks - while you guys are on a roll, one more question that I really don't know. (I knew the first but a client wanted to argue about it and created doubts)

The basis of the property in the hands of the recipient is increased by any gift tax paid. Emphasize "paid" and not simply reported.

Question: what if STATE gift tax is paid but not Federal?

Thanks in advance

[S T]

Gift

Snags,

I agree as well, all of a sudden I am immersed in this on a couple different clients.
so for 2007 and 2008 the limit is $12,000 per donor per person.

So each parent can give to son $12,000 + daughter in law $12,000 +=$24,000

Sandy

[S T]

IRS Pub 551

Simply states increase your basis in the gift by the part of the gift tax paid, doesn't differentiate between Federal or State gift tax.

I would say yes if t/p had to pay Gift Tax to State.

Sandy