My parents gave us everything they could growing up and had very little for themselves. They're good and honest people.

I gave them a secondary credit card on my account and told them to spend up to 1k per month on it.

They rarely reach that level and my mom is always checking in with me to see if purchase X is ok. I have to remind her that I consider that money hers anyways, she can do what she wants with it.

They can afford to live without that money but to me it's the extra that makes their life more enjoyable. They sometimes go out to restaurants (which they pretty much never did), go see shows from time to time and have gotten themselves some new clothes also which they hadn't done more than a handful of times in the last decade.

I'm gonna pay for dental work they need and also vacations together with them.

Not answering your actual question but I hope everyone in this thread who dreams of being able to give back to their parents is able to do so one day.

This is inspiring, really. I just hope that I’ll get that far before they pass.

This is a very wholesome content. Thanks for sharing :)

Former (US) tax lawyer here. You can give up to the maximum allowable gift amount each year, to each of your parents. If you are married, your spouse can do the same (for your parents and their own). This year, the annual gift amount is $17,000, which means you can give up to double that ($34k), and you + spouse can give up to quadruple that ($68k) to your parents.

I never worked on this type of matter directly (I was on the corporate side, not personal), but IIRC there is a form you can fill out to make one gift and have it tap both your and your spouse's gift amounts. But if you're just doing checks, you can easily make them out in four separate checks. The form is useful if you're giving them a car or painting that is below the $68k but above the individual-to-individual gift amounts.

1: https://www.morganlewis.com/pubs/2022/10/irs-announces-incre...

> Former (US) tax lawyer here. You can give up to the maximum allowable gift amount each year, to each of your parents.

Not a tax lawyer, ever, but I know the part that is missing in this statement: “without incurring any immediate or future tax liability [0] or immediate reporting requirement.” If you exceed the per-donor per-recipient limit, you have to file a gift tax return, and the gift counts against your lifetime exemption limit (currently $12.92 million, but also indexed annually by inflation.) If your total lifetime reportable gifts ever exceed that, you’ll have to pay gift tax on the reportable gifts over the limit, and if yiur estate exceeds whatever is left ofnyour exemption when you die, your estate will pay estate tax.

[0] barring a future but retrospective change to tax law, which is theoretically possible but impossible to plan around.

I could add more and more detail, but at some point it doesn't make the comment more helpful, and there's a tradeoff in terms of readability. People are less likely to read super long and jargon-filled comments.

Also, there's a tradeoff in writing something quickly and having it get lots of eyeballs, at a time when those eyeballs are seeing other advice that is much less correct.

Lastly, I did refer to almost all of these specifics in my other comments on the page. But there is no way to include all possible detail in a comment like this, and if someone did it would not get read nearly as much. Also, retroactive changes to tax law are very disfavored at law and would undoubtedly be challenged in court.

Pet peeve of mine: The lifetime exemption limit is absolutely critical information to include when talking about the gift tax in any context because otherwise people take it to mean something completely incorrect. In my experience, the yearly limit being the limit before taxes kick in is one of the most common misconceptions about gift taxes and your comment above basically phrasing it as "maximum allowable gift amount each year" continues this misconception.

I don't mean to be hostile, but I really think its much better phrasing the limit as ~$12 million before being taxable, and just mentioning that you have to report it on your taxes above a certain limit in a given year and that it eats into a lifetime ~$12 million exemption. I basically see people get this wrong any time they mention it on the internet or in real life. I can see though in writing this it does get a bit confusing to say succinctly.

I regularly 'help' my family with out of pocket purchases and expenses. I avoid giving money directly unless as cash because they prefer it that way. I also subsidize one parents rent by offering her reduced rent at a property I own. We still have a contract, but she doesn't pay the full amount I would charge other tenants.

The reality for many of us who grew up in poverty and may have 'made it' to a greater or lesser extent is that our families are likely didn't. It's shocking to me how many M's and Z's don't see themselves as being responsible for their families. I find it highly disappointing.

You don't know other people's life situations, even if you know their financial situations. My family consists entirely of terrible people who don't deserve my help. Any success I have is despite them, not because of them.

But even for people for whom that's not the case, you do not get to impose your morals on them. The idea of owing your parents anything more than you owe the rest of society is a nonsensical social construct that is thankfully dying out.

My parents were abusive and negligent towards me though they have tried gaslighting my childhood. I don't gift out of a sense of duty but for my own conscience. My father is elderly, my mother is not in the best health, and I realize my time with them is short.

You’re a better person than me! My parents were also abusive and I haven’t spoken to them in years. Even just thinking about them gets me sad and upset still. No way I’d send a dollar their way!

> The idea of owing your parents anything more than you owe the rest of society is a nonsensical social construct that is thankfully dying out.

In your case, my comment likely does not apply as it sounds like you were abused horribly as a child, but the statement above is an extreme perspective to take generally, given that a person’s parent(s), typically at the least, provided them with some level of care when they were infants and young children. Of course, there are rare instances of horrible abuse, but it is not endemic. Also, one cannot even exist without parents, so we owe them at least that consideration versus a random person.

Most parents sacrificed some of their future to have children and ignoring that fact is usually (except in extreme cases) reflective of selfishness and self-absorption from the increasingly entitled populations of wealthy countries.

> Most parents sacrificed some of their future to have children

That's a choice they made, though (and usually for selfish reasons). It's like giving someone a gift and then getting upset when they don't pay you back for it.

It’s not about pay back; it’s about helping those in need that once helped you. It also sets a great example for your kids to consider if the day comes when you are old and in need.

> It’s not about pay back; it’s about helping those in need that once helped you.

That... is paying them back, though?

> It also sets a great example for your kids to consider if the day comes when you are old and in need.

That would be the selfish reasons I mentioned. I consider it unethical to expect this of one's children.

I don't actually want an answer because it isn't my business but you should ask yourself: are my parents "terrible" because they hold different beliefs than my own? Or are they terrible because they did something heinous like abuse me or someone I love?

Deeming parenthood a "social construct" and deserving of no attention from the child is ... you must not have kids of your own. That is the only way to explain your current attitude.

I'm going to answer anyway because I can read subtext and don't like people making such assumptions about me: one of them went to jail after putting me in the hospital. The other was an extreme helicopter parent with no concept of their own identity outside of being my parent.

I do not have children of my own, and don't plan to. I think you have the causation backwards, though: this is an effect of my unusual views on families and parenting, not a cause.

(Invariably, around this point, someone snarkily tells me it's a good thing I don't have kids. I unironically agree. Most people shouldn't, and I am very much in that group.)

I'm sorry to hear about such a negative experience. In terms of you having kids, if you were to find a partner that you love and can imagine yourself being with for life, kids are actually incredibly wonderful. Given your experience, you could give them something your parents never were able to.

I wish society didn't seem to be so quick to judge having kids as a negative thing.

I have a partner like that, and this is a thing we discussed very early and very much agree on. Neither of us would enjoy it, and both of us would be terrible parents, because it is very possible to severely screw something up without it being malicious. It would be bad for everyone involved.

I wish society didn't seem to be so quick to assume everyone would be happier with children. Some people legitimately are, but it is not a guarantee.

It seems like you had pretty terrible parents. And yet it doesn't sound like you would rather not be alive. So wouldn't your life experience demonstrate that even people who would be terrible parents, should still have kids?

... no? I legitimately, honestly, cannot comprehend why you would think that.

Had I not been born, I wouldn't know the difference, because I wouldn't exist. That I do exist now is irrelevant, because we're talking about a hypothetical universe where that's not the case. Not being born is a fundamentally different sort of thing than being alive and then dying. (If it wasn't, everyone who can physically have a child and isn't doing so right now would be committing murder.)

Everyone involved would've been objectively better off had I not been born. Both of my parents would have been happier. Everyone around them who had to deal with the fallout would be happier.

To be absolutely clear, this is not an expression of any sort of guilt on my part - I had no input into this terrible decision, and I take no responsibility for it. But any observer would have called it an obviously bad idea, if they didn't have to dance around the psychological and social implications of saying that within earshot of the child. One of the benefits of being an adult with a fully formed brain is that I can now look at such hypotheticals objectively, without conflating them with my own self-worth.

So my past, as terrible as it was, is a sunk cost. If I spontaneously died right now, it wouldn't undo any of that, nor make me or anyone else happier. The best I can do with the situation I am currently in is to keep living, and try not to repeat the mistakes of others.

I consider one of my parents to be an objectively 'terrible' person. I don't think I 'owe' them a god damned thing. However, due to good fortune, I am a person of some means. Its trivial to me to help them out in a mild sense. I do so not out of a sense of parental homage or heritage or any of that garbage. I do so because they are a person in need and its less effort to subsidize some of their costs than it would be for me to feign love or appreciation for the their failures as a parent. However, if it wasn't them, I'd be helping someone else in a similar position. Why? Because the fact is you do owe the rest of society. The non-sense idea that has never been the case is that we are islands unto ourselves. Only pissbabies who never aged mentally past the maturity of a adolescent believe they are their own making.

I actually do agree with you on this one. This wasn't intended as an individualist libertarian take (most of those people would call me a communist, though I don't call myself one), so much as an anti-preferential-treatment-for-family take.

> However, if it wasn't them, I'd be helping someone else in a similar position.

Exactly. I just skip to this part. Ignoring any sort of judgement of their actions, there are many people who need help far more than my parents do, and I'd sooner give money to them.

If my parents legitimately were the most in-need people I could find, I'd have some mental gymnastics to do to justify this, but that is not the case.

Sounds like you had bad parents and now for some reason want to throw out the entire institution (as if it were possible) despite the fact that for the vast majority of humans it’s an overwhelmingly positive experience (not to mention just plain biological).

It’s not even imposing morals on you. The way you’re acting goes against the way humans have acted for thousands of years. To point out that you’re most likely wrong for making that decision shouldn’t be that controversial

it's not about owing my parents anything but that as their child i am responsible to take care of them.

in fact, at least in germany this responsibility is even law. if i were earning above my needs, and my parents were on social welfare, i would be legally obligated to support them. same goes for siblings and children, and possibly other close relatives.

so here society does impose its morals.

or, put differenly, i see it as me owing it to society to take care of my famyly by myself instead of relying on society to do it for me

> It's shocking to me how many M's and Z's don't see themselves as being responsible for their families.

Is it really so shocking given the vast generational wealth inequality in much of society today? In many families the previous generation who may have been working class and earning relatively little, are now property owners, having bought when housing cost far less relative to incomes.

A generation with property and pensions don't need support from renters on historically low wages.

> A generation with property and pensions don't need support from renters on historically low wages.

Right, but we are discussing Mom and Dad and their 'bundles of joy' here, not generational demographic subsets.

Its not like the many of the boomer generation have property and pensions either. The tail of the boomers caught the 1980-90's recessions right on the chin, and many lost anything they built up in 2008, ending up renting through till now.

Plenty of boomers have lots of property, but its a very bimodal bag of have lots and have nothings.

> The reality for many of us who grew up in poverty and may have 'made it' to a greater or lesser extent is that our families are likely didn't. It's shocking to me how many M's and Z's don't see themselves as being responsible for their families. I find it highly disappointing.

You are saying this as you are charging rent to your mother? I have never heard of anyone doing that.

"Hey mom, the rent board approved an 8.8% rent increase. Please sign this document acknowledging the new rate or indicate that you will vacate within 90 days. Thanks, love you!"

Right? If it's rent of $1/month I would totally understand. But the way he phrased it sounds like 25% off his usual going rate. For comedic effect I'll imagine it's 25% off. Or better yet he's charging the entirety of her monthly SSI check and she has to pay for food with a SNAP card.

Perhaps they cannot afford the mortgage payments without some assistance in the rent? Charging her a reduced rent is still better than the cost of living elsewhere.

I'm not in the US so rules are different here, but that's somewhat the situation for me as my mother's "landlord". My mum also insists on paying so she can feel at least some ownership in the property.

There are other factors. I make a loss on renting this property, which has to be reported for tax reasons. If I was charging below market rates it could raise flags. Because my mum also receives an allowance as full time carer for my aunt, it additionally allows them to also claim a bit in rent assistance.

This felt a bit off at first but I have confirmed it's all above board. Better than paying off someone else's mortgage. Most importantly, a few years ago my mum was homeless and my aunt had nobody willing to care for her. This way they have a secure roof over their heads so I have no regrets.

Then there's my brothers who have moved in rent-free while they get back on their feet after a rough patch. It's tough for a lot of people out there, so we have to do what works.

You missed the sentence right before the one about charging their mother rent:

> I avoid giving money directly unless as cash because they prefer it that way

Lots of people want to pay their own way, but old people often have a warped sense of how much things should cost (see the "I worked a part time job to pay for college" thing). So letting their mother think she's mostly paying for her own apartment is itself a kindness.

You've never heard of someone renting a property to a friend or family member at a reduced rate?

Maybe you need to get out more.

A friend or your second cousin is not quite the same as your parent is it? Maybe you need to strawman less

> It's shocking to me how many M's and Z's don't see themselves as being responsible for their families.

Probably because most Z's are still just entering the workforce, and most M's have just began to earn decent money, because of the 2008-09 banking crisis. HN is not representative of the population at wide, so the sentiment you're seeing probably doesn't apply to people making $200k+ total comp.

> I find it highly disappointing.

Do you do anything about it?

> Probably because most Z's are still just entering the workforce

I’m on the older end of GenZ and my parents are middle aged happily working good jobs to support themselves and the new set kids they decided to have.

GP really just seems like they wanted to bitch and whine about “kids these days”.

That’s not the point. This was not about whether someone “loathes” their parents or not. It’s about a feeling of responsibility and financial support. GenZ is at the oldest ~26. Most of them are probably not in the position to brankroll other people and many of their parents are not helpless seniles anyway. The youngest are still fucking children. Are we seriously expecting teenagers to see themselves as responsible for their parents?

And shit if we’re making sweeping generalizations about generations based on personal anecdotes, both my GenX parents had very poor antagonistic relationships with their parents. So don’t try to pin everything on people who came after you.

I suppose that could be an interesting thing to elaborate on. Do you feel like M's and Zs should feel responsible for their families any specific way?

I'm 30 and it's hard to see a future where I'll have any of the financial advantages they did. It's possible, if things go amazingly well, even though I make at least 2.5x their salary at any given moment (on the very low end for a software dev in general with >5 years experience)

I likely won't have kids, might not ever own a home, might end up homeless again, but everyone's situation is different.

Granted, they had kids accidentally, and screwed up their entire adulthood from day 3, but things seemed a little more forgiving because their parents didn't do that.

I think we're all responsible for each other in some way. It doesn't have to explicitly be your biological family, but industrialization has resulted in the atomization of social bonds and familial units, largely in an effort to commoditize and monetize them. Humans evolved in large social units, and we relied on social bonds not only for a shared sense of identity and community, but also for protection, the shared accumulation of resources, etc.

Modern society appears to make many of those evolved tendencies no longer a priority. However, with a bit of a deeper stare, many of the ills we all suffer in this world can be seen as an extension of this atomization. I suppose my broader thesis is that I think we're all responsible for one another in some way. It doesn't need to and shouldn't go beyond your means, but if you can help someone else out, you should. Another example, is that during the pandemic, I let some neighbors and friends take over sections of one of my yards for gardening. They ripped up an area of maybe 200 sq feet, and planted a nice garden for themselves. I had already built and established my own raised beds, but they lived in an apartment, and didn't have access to a community garden. Its a small nicety, a tiny bit of community, but it was basically no effort and minor cost to me to do so.

I'm by no means suggesting that you should impoverish yourself to help other people. I'm following a broader thesis that human bonds and community are things that require building, not bought or borrowed. I do so where I can when I have the means to do so.

And this is where my disappointment with M and Z lay. I don't blame them; I attribute it to the commercialization of all things that has resulted from whatever this modern quagmire we're in is. I'm squarely an 'M', but so many of this generation seem to think that community is something they can buy. They don't seem interested or to understand that sometimes you have to dig your heals in and build the world you want to see. I don't think B was any better in this regard, but M and Z don't have the advantage of a favorable game board to play on. We'll have to do things differently to win.

I think maybe I got lucky, in that I had a period of a couple of years of homelessness after I got out of military service. I ended up in the anarchist/ revolutionary scene, and saw people building a community they wanted to be a part of. They did what they needed to for survival, and a big part of that was building a community. Creating social bonds and ties. Giving and receiving small kindness from one another, like a deal on rent or a space to garden. Offering kindesses where you can is one way to create community, and if you can afford to do so, you should. I've carried that sentiment with me through the decisions I make. If I can make an effort or offer a small kindness, I will. I'm trying to build community where I stand. Its not something I expect to buy or have to rent. It comes from within ourselves.

You should hear the corporatized therapy advice on tiktok.

It's full of nuggets like:

- you're not responsible for your parents, you should never have to take care of them because they gave birth to you.

- you owe you family nothing.

It made me sad, if it weren't for my parents I wouldn't be here today.

I'm of two minds. If course it sucks to be ungrateful to someone who sacrifices real economic opportunity for you.

On the other hand, it's super important for parents to not view their children as property. You're raising something to eventually become a fully fledged, full-agented human, and if they still feel obligated to you purely because of your blood (vs out of seriously analyzing and then concluding that a relationship with you is worth investing into) then you've failed to raise this human with a full sense of agency.

Yes, children shouldn't have to take care of their parents just because the parents birthed them. Children should take care of their parents because the child-parent relationship continues to be great.

> It made me sad, if it weren't for my parents I wouldn't be here today.

I am a parent, and I want my kids to feel like they owe me nothing. If they want to help me or or spend time with me, I want it to be because they enjoy it. And I absolutely do not feel that they need to take care of me.

I do not want to become a burden for them in a way that prevents them from doing what they want.

Children have a "responsibility" for their parents in the same way that a tourist has a "responsibility" to give money to those people who run up and tie a bracelet to your wrist, then demand payment. It was a unilateral action - the tourist didn't ask for it, even if they (or did not) benefit from it.

"Kind"? "Nice to do"? Sure.

But a responsibility? Absolutely not.

Responsibility is probably a socio cultural construct here. My perspective is one absolutely does have responsibility to their parents (exceptional circumstances aside), but I have noticed that as one of the major differences between north America and where I grew up (on both sides of the life equation mind you: where I was born kids weren't supposed to get jobs in high school or pay rent until at least out of university,and generally stay in their family home until they're ready to start their own family. Whereas my grade 12 in Minnesota, everybody was looking to get as far away from their parents for university as humanly possible, and those that didn't had to start paying in - whether rent or car insurance or something. So it feels like the social contract is simply different, even if it feels cold to me :)

Responsibility is always socially constructed. The idea that one person can “owe” another doesn’t exist without people. It’s not a law of nature.

That said, we have drifted very far from the nasty, brutish, and short version of prehistoric society, where your parents might be some of the main people you ever interacted with. Taking care of your parents in that context is quite obvious, because when you were helpless they took care of you, and otherwise no one will take care of them.

> Taking care of your parents in that context is quite obvious, because when you were helpless they took care of you

Well, let's be clear, that is far from universally true.

There's also degrees of care.

I absolutely see where the GP is coming from: my parents chose to have me, I didn't choose to have them. So why would I owe them for simply living up to the responsibilities they chose to take on?

Now, for amazing, supportive parents, the child will want to support and care for their parents when the time comes.

But not everyone has good parents, and I do not believe a child has a responsibility to care for an absent, abusive, or otherwise bad parent simply by dint of genetics.

That is a perspective with support, but I don’t believe it is commonly held. I’ll posit that the vast majority of people are happy at the the fact they exist and so feel there is some degree of obligation to those that enabled that to happen, even outside the normal bonds of familial affection.

This belief is common enough that in some circumstances you have not just a moral but legal responsibility to support your parents:

https://en.m.wikipedia.org/wiki/Filial_responsibility_laws

Children taking responsibility for elderly parents is how society has functioned for millenia. It's a good system.

I disagree. I hope my children do not spend inordinate amount of resources helping me. I want them to live life while they are young and healthy.

If I ever need day to day care for basic needs, I hope I can put myself out of my misery. I want society’s resources to go towards the young, not to keep 80+ year olds limping along.

I watched my parents spend their youth taking care of day to day needs for my dad’s elderly parents. What a waste. My grandparents lived far too long, especially at my mom’s expense.

What do you mean by M's and Z's?

My guess is millennials and zoomers, see https://en.m.wikipedia.org/wiki/Millennials and https://en.m.wikipedia.org/wiki/Generation_Z

Millenials and Zoomers, I assume

I would love some input on this too. I have plans for my retirement at 65 and it requires to save me a good chunk of money. I ran some simulations and if I have to pay long term care for all our parents (me + my wife), we will end up bankrupt in old age.

My biggest concern remains my mother, she is frugal for the small things, but she was highly incompetent with her financial life. She started way ahead (super expensive home from parents, education), she faced a divorce and sold the home, but those money are still lasting nowdays (30 years later), but not very much. She never invested any of that and faced economical challenges to grow me and my sister. Now, back to myself, I started life with 0 money from my mother but education was fully paid (pretty common in the country I come from, since it's public education). She obviously gave me plenty growing up, but she didn't plan anything for retirement.

I will of course feel the urge to help, but it's frustrating to think that given the money she had once sold the home, she could have invested those money and live without working and still own a smaller property.

Essentially, I have this mixed feeling of having to care for a person that started with way more than I started with, but due to poor management, it got all wasted.

I don't even know how to handle those emotions.

If you're giving $30,000 per year as a gift, you should definitely be paying for an accountant and you should ask them about what options there are for tax optimizing this.

There may in your jurisdiction be nonobvious ways to structure this kind of thing that would be advantageous to both you and your parents.

How to ask a question poorly. Which tax jurisdiction? Are your parents living in the same country or a different country?

https://duckduckgo.com/?q=tax+benefit+of+supporting+parents&...

https://duckduckgo.com/?q=tax+benefit+of+supporting+overseas...

My dad had an ischemic stroke a few years shy of social security eligibility. I set up a checking account he's an authorized user on, and I top it up to a few hundred dollars a month. He has a debit card and knows it'll have a balance of $x00.00 on the first of every month.

That's kind of you, and an excellent approach, kudos.

30-40 % of my income goes to my parents. I pay tax on it first before sending.

Just FYI, if you're in the US there may be additional taxes owed. I assume that when you say you pay tax on it before sending you mean income tax, not gift tax (which goes up to 40%). IIRC (it's been a while since law school), you actually have to gross up the gift amount to pay for the taxes, which then results in more taxes and more grossing up. Gifting money and paying the gift tax alongside it is a very expensive endeavor. If you're based outside the US, rules may differ.

Not in US and in Spain. Thanks for heads up though.

Why so much?

I don’t earn a lot. And both my parents don’t work currently. And have smaller brother and sister too.

Do you give money to your parents because they need it (i.e poverty), or because it's a cultural thing?

Here in Norway, it's more or less unheard of to give money to your parents, unless they're financially screwed (in other words, debt) - but that's usually a very temporary thing.

But I've worked with people from all over Asia, and many of them would regularly send money back home. Especially Indian co-workers would send significant sums back home.

Some families in India and other poor countries have pooled almost all of their assets to send a single child to a richer country and/or university. Giving back to them is a moral act of gratitude and love. Wouldn’t you do the same if Norway was a poor country and your parents did the same for you? I admire people like this, and it is a great signal of how they might potentially treat you as a friend, partner, or colleague.

I guess cultural? It's a way to make their remaining days easier and more colorful, if you will. We grew up below lower class and I say that because almost everyone I knew as "lower class" was hoarding cash and getting every benefit under the sun from the government in a major metropolitan area. We were making $1100/month and rent was $1200/month poor.

As I am their age when they raised me and am in the 1% of earners for my age bracket, I would like to do what I can to make their lives a little more extravagant for my own conscience.

I think often it's poverty or relative poverty. Your examples in Asia would probably fall under relative poverty, given that you are in Norway.

I actually take all my mom's money every month and put them in one of my accounts.

Then I pay her fixed expenses and give her cash whenever she wants. She mainly spends money on yarn and LPs.

After retiring, her only trouble in life is her health and her children who beg money from her.

She can't refuse them, but she kept saying she doesn't want to. Eventually we agreed that I admin her money.

We're planning that she moves in with me and my spouse.

Cooking for her every day and removing all economic worries is the best I can give her.

When she leaves Earth, she can decide who her money goes to. (I'm not on the list.)

Not an accountant.

If everyone involved is a US citizen, this year's gift tax exemption is $17000 per recipient. That means you can give up to $34K written as $17K checks to each parent with no fuss.

You and your spouse can each give that amount, which doubles the number if you are married. Also if you go over, you need to file a gift tax form, but you would simply be eating into your lifetime exemption, which several million dollars before you need to pay an estate tax.

I pay my mom's rent.

Just make sure your parents aren't using that money for stuffs like gambling.

I did send money to my parents when I was in Japan. I found some links online, but I think the total I could send was 380k yen per parent (which is about 1/5th of what you are sending)

I give money to my parents. If it is so much that tax might be an issue, I would do it in cash. With me this is (of course) not an issue.

I have a joint account with my parents. I have a recurring transfer that covers their living expenses go into the account each month.

I send my parents $500 a month with Venmo. Really ought to send more.

I send 250 bi weekly electronically - no tax implications

This is pretty much wrong because it misses an important point, which is that this is only discussing the annual gift tax limits.

The lifetime limits are currently 11 million, which means that the first 11 million you give will not be taxed.

I wouldn't characterize GP as "pretty much wrong" — I would say that one line left out that it's an annual gift limit.

Also, there is an 11M lifetime limit that can be tapped beyond the annual gift amount. However, you generally have to file forms when you make such gifts. [1] So although you can give up to $11M during life, you will likely need to file forms in order to not get into trouble. Also, if you have an estate plan, it was very likely drafted with the understanding that you have your entire $11M left intact at death, which allows for certain estate planning techniques. If you have blown through a bunch of it during life, you may wreak havoc on the carefully laid plans of your trust/estate.

1: https://www.irs.gov/instructions/i709#:~:text=If%20you%20are....

> I wouldn't characterize GP as "pretty much wrong" — I would say that one line left out that it's an annual gift limit.

GP said that gifts are taxed if you exceed the annual limit, and this is 100% wrong. The only way you can be taxed on gifts is by exceeding the lifetime limit.

The annual limit determines if you need to report your gift to the IRS or not, but nothing else.

If you stay below the annual limit every year, you will never exceed the lifetime limit, unless you and the recipient live to 140 or something, so the different limits are related, but that's it.

> The annual limit determines if you need to report your gift to the IRS or not, but nothing else.

It can lead to problems with your estate when you die, and result in penalties and interest (from the date of the gift). See https://www.forbes.com/sites/bobcarlson/2022/02/24/avoid-the...

> If you stay below the annual limit every year, you will never exceed the lifetime limit, unless you and the recipient live to 140 or something, so the different limits are related, but that's it.

Actually, if you stay below the annual gift limit every year, you can never exceed the lifetime limit. Only gifts in excess of the annual limit count toward the lifetime amount.

> GP said that gifts are taxed if you exceed the annual limit, and this is 100% wrong.

No, he said “only if” not just “if”, and this is precisely, 100% correct:

X only if Y = X does not occur except when Y occurs (but does not specify whether X cab fail to occur if Y occurs)

X if Y = X always occurs if Y occurs (but does not specify if X can occur without Y)

X if, only if, Y (sonetimes written X iff Y) = X occurs always and only when Y occurs.

(Actually, he said “are taxable”, not “are taxed”, so “only if” would also be correct, more on that below.)

> If you stay below the annual limit every year, you will never exceed the lifetime limit, unless you and the recipient live to 140 or something

No, for two reasons: one, gifts that are below the annual exclusion aren’t taxable and don’t count against the lifetime exemption. Secod, even if you just passed the exclusion for a single recipient (so, you had a taxable gift $1 more than the exclusion level each year—note, the full amount is taxable if you exceed the exclusion), you would never (given historical relationship) reach the lifetime exemption, which annually has increased by more than the annual exclusion.

Gifts of the type subject to tax, to a single recipient, in a single year, exceeding the annual exclusion amount are taxable and must be reported. (Note that the annual exclusion is per recipient from a donor.)

But taxable gifts are only actually taxed on the amount the donor has exceeded the current lifetime exemption (across all recipients).

Can you add some clarity? If I can give $17k/per person/per year, or would be 650 person years before it kicks in?

Is the $11m limit based on the disburser? So I could give $17k per person year, but if I did that to 650 people, I would be taxed after that year?

Generally, I think it’s people in between who need the advice. Someone who gives away $11M should have an advisor; if i give $17k to each of my kids per year, it’s in the grey area and I might not have great legal advice.

11m total is based on gifter, while 17k per year is based on recipient.

If you give more than 17k per year to a kid but will never give away 11m you just need to disclose it on a tax form, you don't need to pay a gift tax. (State taxes can have their own rules)

> The lifetime limits are currently 11 million

$12.92 million currently (2023), actually. $12.02 million last year. $11.7 million in 2021, $11.58 in 2020.

The last time $11 million was correct to the nearest million was 2019 ($11.4 million.)

Do they stack?

The $11M only comes into play if you give more than the annual gift amount in a year. Unlike the annual gift amount (which applies to gifts from you to an unlimited number of individuals — assuming you're not using straw men to funnel money to a desired recipient), the lifetime exemption amount applies to all gifts you give to anyone. That is, you only get one $11M amount, whereas the $17k allows you to make gifts of that amount to any number of people each year.

Except if you give over the $17k/person, then you're supposed to file a federal 709 to report and track the lifetime amount, and if you're lucky enough to have estate tax it will add to that. Whereas if you're under the annual exclusion, there is no paperwork. So the vast majority of people want to just stay under the annual exclusion amount. If someone needs more than $17k this year, call the rest a loan and you can choose to forgive it next year.

Technically a loan requires even more paperwork, I think? And you have to charge interest, even if you then forgive it (which also counts as a gift) you are required to first go through the motions. https://www.schwab.com/learn/story/family-loans-should-you-l...

Yes, I misspoke when I said "there is no paperwork". The difference is that the loan paperwork does not have to be filed with the IRS, whereas a 709 does.

These laws fundamentally exist to constrain how much wealth can be passed down outside of estate tax, which is the main concern of the article you have linked. If you don't quite cross all of the t's when giving a loan to an older family member (which is the complete opposite of trying to push wealth forwards in time), it's unlikely the IRS is going to be too concerned.

Also not a professional, but to elaborate this means if you plan on giving your parents (with emphasis on the plural) 30k that means you can give each of them 15k (write 2 separate checks) and you come in under the 17k per person mark.

Then you don't even have to file the gift form (I think it is 709...) and pay no tax.

> Then you don't even have to file the gift form (I think it is 709...) and pay no tax.

You do not have to pay a tax anyway until you give away a total of $13M in your life, excluding any amounts you gifted that were less than $17k or less per person per calendar year.

This also means if your parents have medical expenses, pay those expenses directly to exclude those gifts from your personal annual exemptions.

Right so he should give 15k to his mom and 15k to his dad with separate checks or cash.

If he is married they can give double without adding it to their return.

There is also more info like a lifetime tax free limit but adding the form to the tax return is annoying regardless and it's best to save that limit for later.

> gifts are taxable but only if above $17k per person.

No, if you exceed the annual per-person limit you have to report your gift, but you're not taxed on gifts unless you exceed the lifetime per-person limit of almost $13 million.