Gifting Strategies To Help You Save on Taxes

Freeman Tax Law

(855)935-5945

Gifting Strategies To

Help You Save On

Taxes

Strategic Gifting Ideas

Freeman Tax Law (855) 935-5945 [email protected] www.freemantaxlaw.com

With the holiday season upon us, many people are turning their attention to giving. The end of the year is commonly a time when people search for the perfect present for their loved ones. What many do not realize is that strategic gifting can provide substantial tax advantages. So this year rather than purchasing that new car with the shiny red bow on top, consider offering the kind of gift that keeps on giving.

Set Up An Education Fund


Are you planning to send a loved one to college in the future? One of the best ways to make this possible is to create a front-loading 529 college savings plan. These accounts are extra-special because you can deposit up to five years’ worth of annual exclusion gifts at one time without incurring any taxable gift. This means the money can be passed onto your loved one tax free as long as they are eventually applied to qualified expenses for higher education purposes. In this scenario, it is important to note that if the donor of the front-loaded five-year gift dies within the five-year period, the prorated portion of the transferred amount for the years after death will be included in the donor’s estate for estate tax purposes.

Donate To Your Favorite Charity


Is there a particular cause or charity that is close to your heart? Gifting long-term appreciated securities can be a particularly tax-efficient strategy and helps provide much-needed funding to non-profit foundations. In general, donations of long-term appreciated securities (stocks or mutual funds) directly to a qualified charity are deductible at their fair market value on the date of contribution, and you do not have to pay capital gains on them. Additionally, the charity benefits from your generosity and is able to continue their work making a difference in the lives of others throughout the world.


Pay Off Medical or Education

Costs For Someone Special

Do you know someone who has accrued a large amount of medical bills or education costs who you want to help? Direct tuition payments to a loved one’s medical care or education costs are not considered taxable gifts. Consequently, they do not count against your annual or lifetime gift tax exemption. This may include an aging loved one’s home care costs, a son or daughter’s college education, or a cousin’s unexpected medical bills. No matter who you help, your gift will be highly appreciated and will also help you reduce tax obligations.

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Freeman Tax Law

About Freeman Tax Law


Freeman Tax Law is a boutique tax law firm with national

exposure equipped to handle all domestic and international tax

law matters. At Freeman Tax Law, the attorneys and

professional staff have vast experience with foreign tax

compliance, international tax planning, and resolving tax

controversies involving offshore banking matters. Freeman Tax

Law helps taxpayers and foreign entities become in compliance

with laws such as Foreign Account Tax Compliance Act

(FATCA) and Offshore Voluntary Disclosure Program (OVDP).

In addition to handling complex tax controversies, the Freeman

Tax Law team has extensive expertise in assisting clients with

wealth management and estate planning.