Taxation of Estates and Gifts

Taxable Gifts

Start with the total amount of gifts made during the year. 26 U.S.C. § 25.2511-2.

Then exclude all medical and educational expenses. 26 U.S.C. § 2503(e).

  • Tuition of medical expenses must be paid to the providers, not the beneficiary.

Then exclude the annual exclusion amount. 26 U.S.C. § 2503(b).

Then deduct marital gifts. 26 U.S.C. § 2523.

Then deduct charitable gifts. 26 U.S.C. § 2522.

Then add the GST tax payable. 26 U.S.C. § 2515.

The resulting amount is "taxable gifts".