This week, I’m talking about  year-end tax planning to help you take advantage of opportunities to potentially lower your taxes this year. 

Today, I’m talking about gifting opportunities. Back in June I devoted an entire week to this topic. If you missed that week and you want to dive deeper into gifting, head on over to my website - truenorthra.com. Under the resources tab, you’ll find the podcast page with links to episode archives. 

Gifting, especially during your lifetime, can be a powerful strategy to transfer wealth, business interests, property, and a variety of other assets to your family and heirs, and with the current generous gifting and estate tax rules, now is the time to gift. Seriously, don’t wait...it’s unlikely that the generous tax laws on gifting will stick around. 

Let me explain...

In 2020, you can give up to $15,000 per gift recipient without paying taxes and up to $30,000 per gift recipient if you're married.

But...you can actually give substantially more to your heirs without being subject to tax. The additional gift will just be applied to your lifetime exemption. 

Let’s say you own a family business worth $3 million dollars. Would you be shocked to learn that you can actually gift that business to your children during your lifetime without paying tax on that gift? 

That’s because of the lifetime gift tax exemption, which is currently $11.58 million in 2020. This means that you can give up to $11.58 million in gifts over the course of your lifetime without ever having to pay gift tax on it. And if you are married, it’s double that amount. You and your spouse can give away a total of $23.16 million before paying the gift tax.

Keep in mind though that if you have substantial wealth or assets to transfer, you want to do it before the rules change and not wait, because the IRS has stated that there will be no clawback on these lifetime gifts. Which means that you can now transfer tens of millions of dollars of your estate - gift tax free, without fearing that those gifts will later be taxed.

That’s it for today. Thanks for listening. My name is Ashley Micciche and this is the One Minute Retirement Tip.

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