What is the annual exclusion amount and how do I utilize it?

Under the Internal Revenue Code, an individual is permitted to gift cash or other property in the amount of $15,000 (in 2021) to as many parties as they choose in a given year. For example, if you have three children, you can gift each of them up to $15,000 for a total of $45,000 in tax year 2021. In order to be a completed gift, the gift must be irrevocable and the recipient must not be obligated to return any part of the gift. You do not have to file a Gift Tax Return if you did not make a gift in excess of the annual exclusion amount.

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