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Gift Tax

A federal tax assessed on gifts; it is officially called the unified gift and estate tax because it applies to property that is given away during life or left at death. Most gifts made during life are exempt from the tax, including gifts of up to $13,000 per year per recipient, gifts to tax-exempt charities, gifts to your spouse (up to $134,000 annually if the recipient isn't a U.S. citizen), and gifts made for tuition or medical bills. Any person can give away or leave at death a total of $5 million free of the gift and estate tax. The tax is assessed at death unless you give away more than the exempt amount ($5 million) in taxable gifts during life. See also: estate tax

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