As you or your family members approach retirement years, it's important to have a basic understanding of the IRS gift giving rules. With this understanding, there are opportunities to leverage this tax law without creating a tax problem.

The rules

• You may give up to $19,000 to any individual (donee) in 2025 and avoid any gift tax filing requirements.

• If married, you and your spouse may transfer up to $38,000 per donee.

• If you provide a gift to your spouse who is not a U.S. citizen, the annual exclusion amount is $190,000.

• Gifts in excess of this annual amount trigger the need to file a gift tax form with your individual tax return. The excess gift amounts are then added to your estate for potential estate taxation.
• The estate tax currently has a maximum rate of 40% and the donor of the gift (or their estate) is responsible for paying the tax.