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06-09-2018, 12:21 PM
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#1
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Give me a museum and I'll fill it. (Picasso)
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Join Date: Mar 2003
Posts: 18,085
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529/gift tax question
We are starting to dump money into 529s for the two kids. We get a state tax deduction so this is attractive. The gift tax exemption is 15k and I am trying to stay within it. I believe that means that dw and I can each give each kid 15k for a total of 30k per kid per year. Is this correct?
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"All animals are equal, but some animals are more equal than others."
- George Orwell
Ezekiel 23:20
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06-09-2018, 12:28 PM
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#2
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Give me a museum and I'll fill it. (Picasso)
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Join Date: Mar 2013
Location: Limerick
Posts: 5,655
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 Quote:
Originally Posted by brewer12345
We are starting to dump money into 529s for the two kids. We get a state tax deduction so this is attractive. The gift tax exemption is 15k and I am trying to stay within it. I believe that means that dw and I can each give each kid 15k for a total of 30k per kid per year. Is this correct?
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No, as a couple each of you can give $15k per child, or $30k for each child. A total of $60k. I’ll be doing the same thing in July when grandtwins are born.
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06-09-2018, 01:27 PM
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#3
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Give me a museum and I'll fill it. (Picasso)
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Join Date: Mar 2003
Posts: 18,085
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Quote:
Originally Posted by Dash man
No, as a couple each of you can give $15k per child, or $30k for each child. A total of $60k. I’ll be doing the same thing in July when grandtwins are born.
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Great. I Mau not have expressed it well, but we both understand it the same way.
__________________
"All animals are equal, but some animals are more equal than others."
- George Orwell
Ezekiel 23:20
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06-09-2018, 01:29 PM
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#4
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Give me a museum and I'll fill it. (Picasso)
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Join Date: Jan 2007
Location: Independence
Posts: 7,299
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Quote:
Originally Posted by Dash man
No, as a couple each of you can give $15k per child, or $30k for each child. A total of $60k. I’ll be doing the same thing in July when grandtwins are born.
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Isn't that just what he said?
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"Be kind whenever possible. It is always possible." Dalai Lama
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06-09-2018, 01:30 PM
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#5
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Give me a museum and I'll fill it. (Picasso)
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Join Date: Mar 2013
Location: Limerick
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Quote:
Originally Posted by calmloki
Isn't that just what he said?
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I guess I needed to read it again.
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06-09-2018, 01:44 PM
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#6
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Recycles dryer sheets
Join Date: May 2008
Location: Treasure Coast
Posts: 472
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I believe you can also make a five-year election and contribute $75,000 for each child per parent ($150,000 total for each child). You won't get the state tax deduction (assuming it has an annual cap) each year like you would if you spread it out.
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06-10-2018, 06:38 AM
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#7
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Give me a museum and I'll fill it. (Picasso)
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Quote:
Originally Posted by 45th Birthday
I believe you can also make a five-year election and contribute $75,000 for each child per parent ($150,000 total for each child). You won't get the state tax deduction (assuming it has an annual cap) each year like you would if you spread it out.
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Oddly, Colorado has no cap on the amount they allow you to deduct.
__________________
"All animals are equal, but some animals are more equal than others."
- George Orwell
Ezekiel 23:20
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06-10-2018, 07:01 AM
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#8
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Moderator
Join Date: Apr 2012
Location: San Diego
Posts: 14,212
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I'm glad we didn't trigger this... We did about $6k/year/kid and have built up enough to cover a good public education for 4 years.
It's odd to me that the gift tax applies if you are the one who set up the account... Technically you own the account (vs the kid). They are the beneficiary, but the parent (or grandparent) is the owner. If you were paying for college outside of a 529 it wouldn't be a gift. But a quick google shows gift tax rules apply.
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Retired June 2014. No longer an enginerd - now I'm just a nerd.
micro pensions 6%, rental income 20%
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06-10-2018, 07:08 AM
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#9
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Give me a museum and I'll fill it. (Picasso)
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Join Date: Mar 2003
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It is possible that this was sloppily written legislation and they simply left the parental exception out. Who knows?
__________________
"All animals are equal, but some animals are more equal than others."
- George Orwell
Ezekiel 23:20
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06-11-2018, 11:18 AM
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#10
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Thinks s/he gets paid by the post
Join Date: Nov 2006
Posts: 1,640
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Years back, we put in $100K lump sum into our DS's account. I filled out the gift tax return and (at least in my state) was able to deduct the maximum $20K per year over the next 5 years.
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