DGAA bLAWg

Are Holiday Gifts Subject to Federal Gift Tax?

Web Admin - Thursday, December 21, 2017
Barrington estate planning and tax lawyerThe holiday season is a time of giving, but as you celebrate this time with your family and friends, you may need to be aware of a certain omnipresent aspect of American life: taxes. While it will likely only apply to people who earn a high income or have large financial assets, it is still a good idea to understand the Federal gift tax and the impact it may have on the gifts you give and your estate.

What Is the Gift Tax?

When a person transfers property to someone else without receiving something of equal value in return, this is considered a gift by the Internal Revenue Service (IRS), and it may be subject to gift taxes. The person who gives the gift to someone else (known as the donor) is responsible for filing tax forms for the gift and paying the gift tax.

Gift Tax Exclusions

Certain types of gifts are excluded from taxes, including gifts given to one’s spouse, gifts given to a political organization, and tuition or medical expenses paid on someone’s behalf. For other gifts, an annual exclusion threshold applies. That threshold is $14,000 for 2017, and the threshold for 2018 will be $15,000.

The annual exclusion applies to gifts given to an individual person, so if a donor gives multiple people gifts of less than $14,000 each, they will not owe any gift taxes. For spouses, the exclusion is doubled, so a married couple can give a gift of up to $28,000 without owing gift taxes.

In addition to the annual exclusion, everyone is entitled to a lifetime exemption known as the basic tax exemption. For people who die in 2017, that exemption is $5,490,000, and in 2018, the exemption will increase to $5,600,000. The taxable amount of gifts greater than the annual gift tax exclusion threshold can be applied toward this lifetime exemption, and taxes will not be owed on these gifts. However, any amount of the basic exemption used during one’s lifetime will be deducted from the amount of their estate that is exempt from estate taxes upon their death.

Contact a Schaumburg Estate Planning Attorney

Determining how gift taxes will affect your finances and your estate can be a complex undertaking. If you want to make sure you are protecting yourself and providing for your family’s financial security, the skilled attorneys at Drost, Gilbert, Andrew & Apicella, LLC can work with you to ensure you have met your legal requirements and have the financial resources in place that your family needs. Contact our Rolling Meadows estate planning attorneys today at 847-934-6000 to schedule a personalized consultation.

About the Author: Attorney Jay Andrew is a founding partner of Drost, Gilbert, Andrew & Apicella, LLC. He is a graduate of the University of Dayton School of Law and has been practicing in estate planning, probate, trust administration, real estate law, residential/ commercial leasing, contracts, and civil litigation. Since 2005, Jay has been a Chair of the Mock Trial Committee for the Annual Northwest Suburban Bar Association High School Mock Trial Invitation which serves over 240 local Illinois students each year.



Source:
https://www.irs.gov/businesses/small-businesses-self-employed/estate-and-gift-taxes

The Effect of the Affordable Care Act on Income Taxes

Web Admin - Tuesday, January 28, 2014

illinois obamacare tax lawyerThe Affordable Care Act (ACA or "ObamaCare") is a sweeping reform that touches many different areas of the law. One particular area that it impacts is the income tax structure. The law makes many small changes, such as increasing the threshold for deducting a medical expense to 10 percent of a person's adjusted gross income, or adding a new 0.9 percent tax to wages above $200,000. 

But, one particular change can have a large effect on income from real estate sales and trusts. The ACA adds a new 3.8 percent tax on a person's net investment income. But, this new tax only applies to certain people, and often, but not always, those in higher tax brackets.

The Effect on Real Estate Sales

The 3.8 percent tax applies to some sales of real estate, but not to all sales. First, the tax only applies to people making more than $200,000 a year or $250,000 for married couples filing jointly. Even for those people, not all sales qualify. This is because the first $250,000 of profit on the sale of the home does not count as income if the home is the person's primary residence.

And, that number goes up to $500,000 for married couples. A primary residence is a home that has acted as the sellers “main home” for two of the last five years. By way of example, suppose a married couple making over $250,000 a year sold their primary residence for a net profit of $650,000. They would only pay the 3.8 percent tax on the $150,000 in profits that exceed the $500,000 cap.

The Effect on Trusts

Even though the tax only applies to individuals making more than $200,000, it can also affect trusts with more than approximately $12,000 in net investment income, regardless of the beneficiary's income. This means that the tax can affect people earning less than $200,000 if they have an interest in such a trust. In this instance, the 3.8 percent tax applies to all net investment income in excess of the $12,000 cap. However, the law contains many exemptions and exceptions. For instance, certain types of trusts that do not qualify as trusts for purposes of income tax also fall outside of this law.

If you have questions about how the ACA affects your taxes or think you may be subject to the new net investment income tax, contact an Arlington Heights tax attorney today. Call 847-934-6000 to speak to a member of our team. We serve many Northwest Suburban areas including Rolling Meadows, Des Plaines, Crystal Lake, and other nearby communities.

About the Author: Attorney Jay Andrew is founding partner of Drost, Gilbert, Andrew & Apicella, LLC. He is a graduate of the University of Dayton School of Law and has been practicing in estate planning, probate, trust administration, real estate law, residential/commercial leasing, contracts, and civil litigation. Since 2005, Jay has been a Chair of the Mock Trial Committee for the Annual Northwest Suburban Bar Association High School Mock Trial Invitation which serves over 240 local Illinois students each year.



Recent Posts


Tags

Long Grove estate planning trust payments Des Plaines drug crimes lawyer Crystal Lake criminal defense attorney Arlington Heights insurance attorney defective products lawyer Barrington criminal lawyer murder charges motorcycle accident lawyer gift tax exemption, estate planning, estate planning strategies, Illinois estate planning, South Barrington estate planning attorneys Arlington Heights wills and trusts attorneys Illinois bicycle safety medical malpractice claims Schaumburg elder law lawyer breathalyzer test irrevocable trust Palatine criminal defense lawyer Rolling Meadows personal injury lawyer Illinois medical malpractice case vacation home fines medication errors premises liability life insurance policy insurance agents Rolling Meadows boating accidents life insurance lawyer Long Grove estate planning attorneys LLCs wrongful death Des Plaines tax law firm fatal car accidents personal injury claim Des Plaines medical malpractice attorney Arlington Heights personal injury attorney slip and fall accidents Illinois corporate lawyer insurance dispute, insurance dispute lawyers, insurance claim denial, insurance claim delays, Rolling Meadows insurance dispute attorneys drug crimes lawyer Arlington Heights injury attorney employee misclassification dram shop law Illinois employment lawyer Schaumburg Food and Drug Administration's Food Safety Modernization Act elder abuse first degree murder Buffalo Grove probate lawyer insurance claim dispute Barrington workers compensation attorney Rolling Meadows probate lawyer natural gas explosion Schaumburg personal injury attorney startup company eluding a police officer Illinois home inspection Buffalo Grove law firm insurance claims reckless homicide Illinois rollover accident lawyers Schaumburg probate attorney marijuana crimes attorney Rolling Meadows traffic attorney Home Remodeling Repair Act Crystal Lake employment law attorney Long Grove real estate attorney power of attorney Crystal Lake pet attorney probate claims Buffalo Grove insurance claim dispute lawyers loss of consortium Chicago will attorney, social media platforms, Illinois estate planning lawyer, Forcible Entry clemency work unions Des Plaines real estate attorney Palatine civil attorney Deer Park DUI lawyer Rolling Meadows accident lawyer Des Plaines real estate lawyer Inverness probate lawyer POA modern family estate planning Long Grove real estate lawyer denied insurance claim Palatine insurance lawyer Crystal Lake bike accident lawyer Deer Park workers compensation lawyer operating agreements South Barrington real estate attorney School Visitation Rights Act sexual images caregiver Schaumburg medical malpractice lawyer Palatine trusts lawyer overtime pay Deer Park traffic accident attorney Rolling Meadows boating crash lawyer financial advisors hiring employees Whistleblower Claims foreclosure Landlord Tenant Ordinance Illinois registered agent Illinois estate planning attorney Illinois personal injury lawyer Palatine corporate law attorneys Schaumburg personal injury lawyer income distribution deducation right to work employment contract, employment law, employment at-will, Deer Park employment law attorneys, contract, Schaumburg estate planning lawyer traffic laws Illinois medical malpractice claim Crystal Lake pedestrian accident lawyer Chicago traffic lawyer Illinois car accident attorney texting and driving personal injury attorney DNR Schaumburg Attorney Crystal Lake employment attorney Rolling Meadows business lawyer Inverness real estate lawyer employee discrimination blended families Illinois law living wills subcontractor Illinois insurance attorney digital assets Buffalo Grove personal injury lawyer insurance claim denial breach of contract Des Plaines personal injury attorney Retaliatory Discharge Chicago attorney Rolling Meadows insurance dispute lawyers Rolling Meadows traffic law firm Barrington employment law attorney Inverness real estate attorney Arlington Heights TBI attorney Illinois will lawyer Illinois personal injury attorney Illinois red light cameras Barrington litigation attorney condo association hands free device pain and suffering murder defense car collision healthcare Schaumburg traffic lawyer Illinois business law atorneys Home Sale Contingencies Kenilworth estate planning attorneys Rolling Meadows real estate attorney probate claims process products liability Deer Park medical malpractice attorney Arlington Heights wills and trusts lawyers Illinois jet ski accident lawyer capital gains tax Illinois mortgages estate planning employment contract defective products Joliet general practice lawyers insurance adjusters estate planning, digital assets, Revised Uniform Fiduciary Access to Digital Assets Act, Illinois digital assets, Illinois estate planning, mass shooting blood alcohol content Illinois workplace lawyer Barrington boating accident attorney child safety insurance attorney elder law natural gas Crystal Lake medical malpractice law firm workers comp Arlington Heights employment law attorneys personal injury claims crossover accidents Long Grove wills and trusts attorneys Rolling Meadows tax attorney Chicago trucking accident attorney Illinois small business preventing accidents estate plan condo unauthorized overtime Des Plaines accident attorney medical malpractice, missed diagnosis, delayed diagnosis, medical mistake, Deer Creek medical malpractice lawyers homestead rights expungement real estate contract TBI nursing home negligence Barrington drug crime attorney Liquor Control Act Schaumburg estate planning attorney manufacturing real estate lawyer Self-Directed IRA Accounts privacy laws real estate attorneys Rolling Meadows estate planning attorney advance healthcare directive taxes guardianship attorney bad faith insurance claims field sobriety test DUI defense filing a medical malpractice claim motorcycle accident Buffalo Grove corporate attorney drunk driving statistics Illinois business lawyer Crystal Lake accident attorney IRA trust transfer Detainer Actions Illinois injury lawyer Illinois Trust Code murder insurance claim wills and trusts college kids underinsured motorist Palatine Attorney independent contractor workers compensation drugs criminal law Illinois traffic accident lawyer consent to a search auto accidents Palatine employment attorney surgical mistakes FSLA Arlington Heights accident attorney minimum wage Palatine drug lawyer drug crimes Schaumburg insurance lawyers wrongful termination automated cars Illinois elder law attorney Des Plaines Deer Park criminal attorney caretaker rights Illinois workers compensation lawyer Employment Discrimination Law Buffalo Grove car accident lawyer Illinois trusts attorney estate tax Rolling Meadows insurance lawyer denial of life insurance car accidents Illinois insurance dispute lawyers traffic offenses insurance dispute attorney DUI paid sick leave distracted driving accidents Crystal Lake tax lawyer pet bites Rolling Meadows medical malpractice lawyers Palatine elder law attorney car accident lawyer Illinois medical malpractice lawyers icy parking lots digital evidence Inverness insurance attorney appealing an insurance claim Barrington civil litigation attorney ACA controlled substance Chicago estate planning Rolling Meadows criminal lawyer Federal Food Drug and Cosmetic Act attorney fees Crystal Lake traffic attorney Illinois personal injury lawyers insurance negligence rumble strips Arlington Heights Attorney deed transfer special needs trust Barrington injury attorney Illinois criminal defense attorney Buffalo Grove employment lawyer Long Grove estate planning attorney vacation home probate process Des Plaines personal injury lawyer unpaid overtime personal injury coronavirus power of attorney for healthcare meal breaks Illinois workers compensation attorney cell phone insurance agent negligence Legal Info estate planning attorney personal injury, auto accident injuries, delayed injuries, serious injuries, Des Plaines personal injury attorneys anesthesia errors Rolling Meadows personal injury lawyers whistleblower protections Illinois personal injury contracts speeding estate attorney Deer Park traffic lawyer Illinois insurance claims lawyers Illinois employment law attorneys Schaumburg estate attorney Jay Andrew Illinois wills and trusts Rolling Meadows Traffic Lawyer Inverness civil lawyer trustee compensatory time real estate closing Illinois motorcycle accident lawyer Inverness elder law lawyer spinal cord injury Mount Prospect wills and trusts lawyers Schaumburg wrongful death attorney Illinois estate planning law firm personal injury accidents Illinois LLC creation Illinois trucking safety Crystal Lake car accident lawyer Schaumburg drug defense lawyer construction contracts Illinois workplace discrimination attorney Crystal Lake employment lawyer pet law medical marijuana mortgage owner responsibility distracted driving accident victims Illinois Human Rights Act trusts traffic crimes pedestrian-automobile accident real estate zoning life insurance claims Arlington Heights Traffic Lawyer Illinois estate planning Illinois driving without license personal injury lawyer Palatine workers compensation lawyer Rolling Meadows corporate lawyer Des Plaines collections attorney Do Not Resuscitate Barrington attorney Inverness corporate attorney sexual harassment senior citizens Illinois employee rights attorney. Chicago insurance law firm Illinois pet lawyer liens Arlington Heights real estate lawyer Chicago will attorney Thanksgiving pay when paid contract workplace sexual harassment Barrington Traffic Lawyer criminal record civil litigation real estate Illinois medical malpractice attorney accidental death benefits trucking accidents Affordable Care Act DGAA denied insurance claims criminal creditors license changes to mortgage law traffic deaths ObamaCare internet CAM Barrington Illinois estate planning lawyer Illinois living will liability claims pedestrian accident bicycle dooring accidents Inverness traffic law firm Illinois collections attorney brain injury criminal defense Chicago employment attorney deadly crashes spinal cord injuries Illinois employment law Transfer on Death Instrument Arlington Heights personal injury lawyer Des Plaines DUI attorney Schaumburg construction accident lawyer Crystal Lake personal injury attorney unfunded trust comp time business litigation license reinstatement Fourth of July jet ski low-ball insurance settlement Illinois insurance disputes Illinois traffic laws Illinois defective products attorney Illinois Transfer on Death Instrument Arlington Heights lawyer employees preventable medical errors medical malpractice corporate law Des Plaines criminal attorney Des Plaines civil attorney commercial real estate car accident Rolling Meadows employment law attorney Mount Prospect real estate lawyer Barrington medical malpractice lawyers Crystal Lake civil litigation lawyer federal regulations for LLCs Palatine traffic lawyer wills BAC trauma after an accident real estate leasing Illinois employment laws overtime violations Barrington estate planning attorney Rolling Meadows litigation lawyer employment lawyer Illinois wrongful termination lawyer Schaumburg personal injury lawyers Rolling Meadows personal injury attorney Buffalo Grove real estate attorney Inverness accident lawyer bike accident DUI penalities wage theft estate planning trusts landlord Illinois pedestrian accident attorney bicycle accidents digital media accounts, estate planning, Arlington Heights estate planning attorney, Illinois Wage Payment and Collection Act medical malpractice compensation Illinois DUI attorney Chicago estate planning lawyer fiduciary rule Illinois civil litigation lawyer Schaumburg criminal attorney Arlington Heights trucking lawyer Des Plaines claims law firm Schaumburg criminal law attorney rollover accidents Kenilworth estate planning attorney cell phone tower data llinois Real Estate Lawyers Association institutional trustee Illinois lawyer wrongful termination, employment law, whistleblower protections, Illinois employment laws, discrimination in the workplace digital information Buffalo Grove criminal defense lawyer Arlington Heights estate planning attorney Buffalo Grove medical malpractice lawyers Illinois traffic attorney Illinois wills and trusts attorneys digital assets, digital fiduciary, estate planning, digital content, Long Grove estate planning lawyers involuntary manslaughter Des Plaines motorcycle accident attorney traffic violations insurance disputes Crystal Lake medical malpractice lawyer Illinois boating accident lawyer estate planning for college students severance agreements Illinois Workers’ Compensation Commission Illinois job attorney Schaumburg employment law attorneys Barrington personal injury lawyer fault based insurance Arlington Heights car crash attorneys civil litigation attorney Des Plaines injury law firm DMV health insurance dispute Arlington Heights criminal lawyer Rolling Meadows criminal attorney living trust benefits Crystal Lake medical malpractice attorneys Barrington employment attorney construction accidents, personal injury, wrongful death, Arlington Heights personal injury attorneys, workers' compensation insurance dispute hit and run accident Illinois employment law firm Palatine civil litigation lawyer Crystal Lake insurance lawyer Crystal Lake traffic lawyer unpaid assessment insurance denials workers compensation benefits BAIID Palatine injury attorney Mt Prospect Attorney Des Plaines insurance attorney Illinois probate lawyer Rolling Meadows marijuana attorney gift taxes Palatine traffic accidents fiduciary rule delay Colin H. Gilbert Crystal Lake personal injury lawyer pedestrian injuries, pedestrian fatality in terrorem provision Schaumburg corporate attorney Inverness estate planning lawyer rest breaks Schaumburg employment attorney texting while driving Palatine law firm rent to own real estate contracts Illinois Smoke Detector Act sole proprietorship Palatine personal injury lawyer Arlington Heights tax lawyer Palatine real estate lawyer dynasty trusts Schaumburg real estate lawyer drunk driving traffic accidents Family Medical Leave Act probate lawyer Illinois Probate Act of 1975 BUI Kenilworth estate planning lawyer underfunded trust dealing with problem employees insurance claim delay jet ski accidents residential real estate Illinois employment law attorney Illinois insurance claim attorney Illinois insurance lawyer healthcare claims Barrington criminal defense lawyer tax attorney Policy Cancellation privacy uninsured motorist boating under the influence GM ignition switches Rolling Meadows insurance dispute lawyers, insurance dispute estate planning lawyer Illinois speeding lawyer Crystal Lake law firm Schaumburg injury lawyer Barrington personal injury attorney traffic tickets landlord tenant law Des Plaines Traffic Lawyer dog bites investment property Illinois employment attorneys Rolling Meadows drug defense attorney Schaumburg civil litigation attorney Illinois traffic ticket lawyer Illinois insurance claim dispute lawyer Colin Gilbert Illinois attorney Des Plaines pet law attorney Palatine employment law lawyer Barrington real estate lawyer trench injuries Illinois traffic attorneys driving real estate attorney ken apicella holiday statistics estate planning, death tax, succession plans, business estate plans, Barrington estate planning lawyers drug crime IRS pizza emoji Chicago corporate attorney Class A misdemeanor slip and fall Arlington Heights employment attorney Illinois Sales Representative Act Crystal lake insurance dispute attorney disability benefits Deer Park personal injury lawyer Rolling Meadows employment attorney Deer Park accident attorney liability insurance denial appeals trucking accident lawyers Illinois construction accident attorney car accident lawyers Attorney Ken Apicella Deer Park motorcycle accident lawyer Rolling Meadows insurance attorney federal crimes IRA benefits small business living trust vs will Arlington Heights pedestrian accidents car crash insurance disputes, Illinois insurance disputes, Illinois insurance dispute attorneys, denied insurance claims, Arlington Heights insurance dispute attorneys probate Palatine business attorney pregnant women new real estate form Deer Park employment law attorney underage DUI Rolling Meadows DUI lawyer rollover car crashes Buffalo Grove traffic lawyers employee rights boating DUI construction accidents life insurance Super Mario Rolling Meadows employment law attorneys Crystal Lake will lawyer job lawyers Exclusions Arlington Heights car accident lawyer installment contracts Mount Prospect elder law attorney comparative negligence Crystal Lake business law attorneys living trust product liability Fair Labor Standards Act license revocation marijuana employment attorney traumatic brain injuries food poisoning Palatine corporate attorney Illinois problem employees truck collisions agent Arlington Heights traffic attorney Arlington Heights wills and trusts attorney Inverness personal injury attorney South Barrington real estate lawyer Buffalo Grove traffic attorney Chicago biking tips Deer Park real estate law firm license suspension Palatine employment lawyer social media after death head on collisions commercial leases Arlington Heights medical malpractice lawyer Illinois real estate Des Plaines personal injury lawyers forming a corporation in Illinois no contest clauses Illinois real estate lawyer car crash injuries Palatine estate planning lawyer pedestrian accidents DUI attorney golf accidents Palatine punch death Chicago employment lawyer Crystal Lake car accident attorney civil rights violation employment law Palatine construction attorney Illinois tax attorney personal injury law firm Riverwoods estate planning lawyer traumatic brain injury FMLA insurance claim dispute attorney Rolling Meadows car accident lawyers swimming pools drug possession foreclosed rental property medical research Barrington estate planning lawyer Inverness injury lawyer back injuries commercial leasing Crystal Lake estate planning lawyer suspended license PTSD Buffalo Grove personal injury attorney Arlington Heights wills and trusts lawyer insurance claim denials home inspection lawyer Inverness DUI lawyer Schaumburg car accident attorney loopholes cell phone accidents Des Plaines drug lawyer traffic violations defense Rolling Meadows Attorney revenge porn Chicago lawyer employment law, meal breaks, rest breaks, hotel employees, Des Plaines employment law attorneys probate fees car crashes Chicago insurance claim attorneys Palatine probate lawyer Buffalo Grove injury lawyer IRELA Illinois insurance claim dispute lawyers Barrington business law firm Chicago car accident lawyer Barrington employment law firm Crystal Lake injury attorney employment law, Illinois employment laws

Archive