What are the tax implications of giving away property?

When it comes to gifting property, it is important to take into account the tax implications that accompany the act. In the state of North Carolina, most gifts of property are subject to gift tax. A gift of property occurs when an individual transfers money or the ownership of property to another person without expecting the recipient to pay anything in return. In general, individuals are allowed to give up to $15,000 of gifts each year to any one person without being subject to the gift tax. However, any amount greater than $15,000 will be taxed at a rate of 40%. It is important to note that if the gift is to a spouse, the threshold is much higher at $152,000 in 2020. When gifting property, individuals must also consider the capital gains tax. This is a tax that applies to the increase in value of a property that is sold. If a property is sold for more than what it was originally purchased for, the gain is subject to capital gains tax. When gifting property, the giver will not be liable for the gain, but the recipient of the gift may be subject to capital gains tax when they go to sell the property. As such, it is important to consider the tax implications of any gifting of property prior to its transfer. An elder law attorney in North Carolina can provide expert advice on the most tax-efficient methods of gifting property.

Related FAQs

What is a pooled trust?
How can I ensure that my elderly parent’s wishes are respected?
What is a pour-over will?
How can I ensure my elderly parent's wishes are respected after they pass away?
What are the benefits of setting up a trust?
What is a trust fund?
What is a living probate?
What is a Medicaid trust?
What is a trust?
How can I ensure my assets are protected in a long-term care facility?

What are the tax implications of giving away property?

Related FAQs

Related Blog Posts