The Annual Exclusion

The annual exclusion is a tax benefit that allows you to give a certain amount of money or assets each year to an individual without having to pay gift taxes or use up your lifetime gift tax exemption. For example, in 2023, the exclusion amount is $17,000 per recipient. This means you can gift up to that amount to as many people as you like annually without triggering gift tax paperwork or costs. It helps in estate planning by allowing you to transfer wealth gradually while minimizing tax implications.