Gift Tax Limit 2010

If you give away a lot of money, then you could be responsible for paying federal gift tax. Currently you can give away around $13,000.00 to any amount of people without having to pay federal gift tax.You also have a one million dollar lifetime limit on gifts.

Gift Tax Limit

If you plan on giving away more than that then you may want to do some pre-planning so neither you nor the recipients of your gifts owe taxes on them. The gift tax was created to make it more difficult for taxpayers to avoid paying estate tax.

Here are some helpful tips when giving away large amounts of money or assets:

• You and your spouse can give away up to $26,000.00 annually to any number of people.

• You have a lifetime limit of $1,000,000.00 to give away tax free.

• The gift cannot have any exclusions and is money or property given away without an expected return.

• If you must claim the federal gift tax on your gifts then you must file using Form 709.

• Giving away property or money before your death can provide a huge tax savings to your friends and family.

• If you pay someone else’s medical expenses then you must pay them directly to the care provide for them to be considered a gift.

It is also important to know that gifts of educational expenses will not be taxed under the federal gift tax limit rules. This includes payments directly made for education, books, supplies, and other related living expenses. Charitable gifts and gifts to your spouse are also not taxed.

You are allowed to give up to one million dollars in gifts above the annual limit in your lifetime without having to pay taxes. This means you need to plan carefully to ensure you do not exceed your annual limit as well as your lifetime limit.

To find out if you owe federal gift tax or to learn more about the gift tax limit, visit TurboTax Online.

Withholding Calculator 2010

Employers are required to withhold some of our money from our paycheck and send it to the IRS. This is actually a prepayment of tax we will owe at the end of the year.

You want to make sure your employer is withholding enough or else you will have to pay when the tax season rolls around.

How do I know if my Employer is Withholding Enough?

That is a good question and everybody should be asking about this. A simple search online will lead you to all sorts of federal tax withholding calculators. Be careful though, estimate means it’s a rough guess. You would be better off using a calculator from the same source you use to prepare your income tax return online.

Federal Tax Withholding Estimate for 2010, 2011

Keeping Tax Information Together

If you keep all of your tax information together in one place, you will have a more accurate estimate of your federal withholding rate. Your personal profile will have the necessary information about your filing status and dependents. All of the information combined will determine if enough money is being withheld from your paycheck.

Key Considerations for Withholding

1. Are you an employee with two concurrent jobs?

2. Do you and your spouse both work?

3. Can you be claimed on someone else’s tax return as a dependent?

Do you see what I mean? The more money you make, more withholding has to occur so you don’t end up with a huge amount when you file your federal income tax return.

Do you Want More Money now or a Bigger Refund?

If you would like your weekly check to be bigger then, you can have your withholding reduced so, your check has more money now for everyday living. If you want a bigger refund at the end of tax season then, you can ask your employer to withhold more money now so, the refund will be bigger but, your weekly check will be somewhat smaller now.

Just the Tip of the Iceberg

If you would like more information about withholding you should visit TurboTax Online for complete information concerning federal tax withholding estimates. Perhaps you receive a pension or unemployment income.

What about self-employment tax or what if my job ends before the year is over? This is where withholding gets a little more complicated and when we call in the Tax Experts. Don’t risk landing yourself in a big mess. Try TurboTax Online today along with millions of other Americans!