Monday, January 24, 2011 NEET Tips
NEET Tips answers questions posed online to the NEET website
What is Gift Splitting?
When a married person makes a gift to a person other than his or her spouse, both spouses may elect to treat the gift as though it had been made one-half by each of them. This allows a donor to make a gift of double the annual exclusion amount ($13,000 in 2011), if their spouse consents.
There are some rules. First, both spouses must be a citizen or resident of the United States. Second, the couple must be married at the time of the gift and the consenting spouse may not remarry during the remainder of the calendar year. Third, an election to split a gift applies to all gifts during the calendar year when the gift was made. In other words, spouses may not pick and choose which gifts made during the year will be treated as split gifts and which will not. The spouse’s consent to splitting gifts is made on a gift tax return that is due by April 15 of the year following the year in which the gift was made. |