In 2026 a married couple wishes to gift as much as possible to their four children without making any taxable gifts or using any of their applicable credit amount. What is the total amount they can give each year?

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Multiple Choice

In 2026 a married couple wishes to gift as much as possible to their four children without making any taxable gifts or using any of their applicable credit amount. What is the total amount they can give each year?

Explanation:
The key idea is the annual gift tax exclusion, which lets you give a set amount to each recipient every year without it counting as a taxable gift. In 2026 the exclusion per individual is $19,000. A married couple can use gift splitting, allowing the gifts to count as if made by both spouses, effectively doubling that amount to $38,000 to each child per year. With four children, the total you can gift tax-free without using any of the lifetime exemption is 4 × 38,000 = 152,000. To do this properly, they would file Form 709 to elect split gifts.

The key idea is the annual gift tax exclusion, which lets you give a set amount to each recipient every year without it counting as a taxable gift. In 2026 the exclusion per individual is $19,000. A married couple can use gift splitting, allowing the gifts to count as if made by both spouses, effectively doubling that amount to $38,000 to each child per year. With four children, the total you can gift tax-free without using any of the lifetime exemption is 4 × 38,000 = 152,000. To do this properly, they would file Form 709 to elect split gifts.

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