What amount of gift tax applicable credit remains available to Norma in 2021?
Norma, a widow, has made lifetime gifts to her two grandchildren in an effort to reduce the size of her gross estate. In 2012, Norma made a $100,000 taxable gift. She made another $150,000 taxable gift in 2014. She used her gift tax applicable credit amount to offset any gift tax liability for all gifts.
What amount of gift tax applicable credit remains available to Norma in 2021?
The gift tax is a tax on gifts that must be paid by the taxpayer who gives significant money or valuable assets to another person without expecting anything in return. Depending on the type of gifts and their monetary value, the tax rate can be anywhere between 18% to 40%. This tax is imposed to stop taxpayers from transferring valuables and cash to others just to reduce their tax obligations.
Step by step
Solved in 2 steps
