Who pays the IRS tax on a “gift”?
Do you know who pays the tax on gift that is subject to federal estate tax?
In a previous post, I described what the IRS considers to be a gift.
If a gift has been made and there is no exclusion connected to it, gift tax may be due. However, while a federal gift tax return may be required based on only one gift of $15,000.00, the chances of owing tax on a gift are much more remote. The gift or gifts would have to exceed the unified credit amount, which currently stands at approximately 5.4 Million Dollars.
Nonetheless, if tax is due to the IRS on a gift, usually the person making the gift pays the tax.