Did you transfer your home or property to your children? Even if they weren\u2019t technically gifted, did you \u201csell\u201d them for a dollar? If you failed to file a gift tax return, there may be an unwelcome IRS letter arriving in your mailbox soon. The IRS is currently scrutinizing real estate transfers in 15 states – yes, New Jersey and rest of tri-state area included – with additional states likely to be added. It has found that 60-90% of gratuitous non-spousal real estate transfers were not reported on gift tax returns. Perhaps you are thinking \u201cOK, so I\u2019ll be more careful about this in the future but unless the IRS audits me I\u2019m fine\u201d-think again!\u00a0 If you make future taxable gifts requiring the filing of gift tax returns, those returns must disclose your prior gifts. If you do not include a gift from a prior year, the future return is false.<\/p>\n
While it does require\u00a0\u00a0 effort and expense to file your 2011 gift tax return, the fact that there is a\u00a0\u00a0 lifetime $5,000,000 gift tax exemption can allow you to rest assured that you won\u2019t be facing a tax liability if you stay under that amount. The IRS is primarily targeting\u00a0\u00a0 transfers before 2011, as there was only a $1,000,000 gift tax exemption in prior years. It is important to note that this lifetime exemption is cumulative; meaning that if you transferred a property worth $800,000 to a non-spouse in 2008, and then a $300,000 property in 2010, the $100,000 excess over the gift tax exemption would be subject to gift tax.<\/p>\n","protected":false},"excerpt":{"rendered":"
Gift Tax Return wasn’t filed? IRS scrutinizing non-spousal real estate transfers in 15 states. NJ, NY, PA and VA are among the 15 states. IRS is targeting transfers prior to 2011, when the gift tax exemption was $1,000,000 to find non-filers who owe gift taxes.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4,35,6,22,23],"tags":[103],"class_list":{"0":"post-445","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-small-business-forum","7":"category-estate-taxes","8":"category-estate-trusts-guardianships","9":"category-tax-tips-for-individuals","10":"category-taxes","11":"tag-gift-taxes","12":"entry"},"_links":{"self":[{"href":"https:\/\/www.ua-cpas.com\/blog\/index.php\/wp-json\/wp\/v2\/posts\/445","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.ua-cpas.com\/blog\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.ua-cpas.com\/blog\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.ua-cpas.com\/blog\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.ua-cpas.com\/blog\/index.php\/wp-json\/wp\/v2\/comments?post=445"}],"version-history":[{"count":0,"href":"https:\/\/www.ua-cpas.com\/blog\/index.php\/wp-json\/wp\/v2\/posts\/445\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.ua-cpas.com\/blog\/index.php\/wp-json\/wp\/v2\/media?parent=445"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.ua-cpas.com\/blog\/index.php\/wp-json\/wp\/v2\/categories?post=445"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.ua-cpas.com\/blog\/index.php\/wp-json\/wp\/v2\/tags?post=445"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}