Present Interest Gifts

Present interest gifts refer to assets or property given to someone that they can use or enjoy immediately. For example, if a grandparent gives a child a car or cash, the child has the right to use that gift right away. This contrasts with future interest gifts, where the recipient only gains access after a certain period or event occurs, like when they reach a certain age. Present interest gifts are important for tax purposes, as they may qualify for annual gift tax exclusions, allowing the giver to reduce their taxable estate while providing immediate benefits to the recipient.