Can the 529(c)(2)(B) election be made two years in a row. For example, if someone contributes the following amounts to a beneficiary's 529 plan:
$51,000 in 2023
$36,000 in 2024
Can the 2023 contribution be treated as having been ratably over a five year period starting in 2023? Can the 2024 contribution be treated as having been ratably over a five year period starting in 2024? If this is allowed, the total amounts of non-taxable gifts will be:
2023: $51,000/5 = $10,200 (Limit is $17,000)
2024:$51,000/5 + $36,000/5 = $17,400 (Limit is $18,000)
2025:$51,000/5 + $36,000/5 = $17,400 (Assume limit remains $18,000)
2026:$51,000/5 + $36,000/5 = $17,400 (Assume limit remains $18,000)
2027:$51,000/5 + $36,000/5 = $17,400 (Assume limit remains $18,000)
2028: $36,000/5 = $7,200 (Assume limit remains $18,000)
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Not sure what you're getting at but a 709 would be required for donee B because it's over $18k.
Donee C's gift of $3k wouldn't even need to be reported on the 709 at all.
Thank you, M-M Tax! Per the web-site you quoted, clearly it is allowed. Can this also be found on the IRS site or somewhere in the tax code?
Perfect, thanks!
Slightly different gift tax question:
In 2024, let's say unmarried donor A makes the following gifts:
Questions:
If all of this is true, seems a bit odd that a donor can essentially 'offset' a large gift to one donee by 'spreading' the annual exclusion amounts across several donees with small gifts (as low as $1 even)? Am I missing something? For 709 instructions do not seem to clarify this point. Just trying to understand the gift tax stuff better.
Not sure what you're getting at but a 709 would be required for donee B because it's over $18k.
Donee C's gift of $3k wouldn't even need to be reported on the 709 at all.
That makes sense now, thanks.
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