Broker Check

Gift Giving Considerations for Tax Benefits

November 29, 2022

To give is better than to receive, unless you’re giving more than your fair share to Uncle Sam. As you prepare your holiday gift list, you may opt to give family and friends gifts with lasting value that also offer tax benefits for you.

Consider the following for:

  • Adult children: The IRS allows you to gift up to $14,000 per individual free of gift or estate tax.
  • Grandchildren: Make a tax-free contribution to a grandchild’s 529 education savings plan.
  • The friend who has everything: Consider a tax-free contribution in their name to a cause they’re passionate about.
  • Charitable organizations you support: Make a tax-free year-end cash contribution, or donate securities (such as shares of stock) or real property (such as a car or boat).   

And don’t forget to give a lasting tax-advantaged gift to yourself:

  • If you’re eligible to participate in a 401(k) or similar qualified plan, try to contribute the maximum allowable or at least enough to receive any employer matching contributions.
  • If you’re 50 or over, take advantage of catch-up contributions for IRAs and employer-sponsored plans.

If you have questions or need assistance with year-end financial and tax planning, don’t hesitate to contact the office.

The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation.