By Paul Morrone CFP®, CPA/PFS, MSA
Leave it to our taxing authorities to make giving money away a complicated process. As the old saying goes - the only thing certain in life are death and taxes - and even your good-natured gift to your favorite grandchild can fall subject to scrutiny by the IRS if you’re not aware of the rules. It is always wise to consider the financial ramifications of making gifts from both a portfolio and tax perspective, as the complicated (and antiquated) gift tax system here in the US doesn’t appear to be going away anytime soon. Luckily, gifts carrying a value of less than $15,000 per person per year can generally be made with no strings attached, as current law allows gifts under this amount to be excluded from taxation and reporting. Married couples have an even longer leash and can essentially pass $30,000 unencumbered to an individual by each writing a $15,000 check a designated recipient. Remember, the $15,000 is an aggregate limit applied to the cumulative amount of gifts you make to an individual from January 1st until December 31st, not just the big one during the holidays.