How a person may want to share their wealth with a loved one often depends on their attitude about money. Some parents or relatives may want to share money or gifts with a loved one while they are still alive. A taxpayer can give away up to $14,000 as a gift without triggering any tax consequences. Some parents may want to use their money to pay off a child’s student loan debt. There are no tax consequences for paying off student loan debt so long as the funds are payed directly to the educational institution. Another way people can give to a relative or child involves setting up a college-savings plan. It is important for people, especially those who are elderly, to be aware of local Medicaid rules. There are a number of States that have regulations that prohibit people from giving away assets in an effort to qualify for Medicaid.
See Joe Blundo, Guide to Life: Pros and cons of leaving inheritances to relatives, The Columbus Dispatch, October 17, 2015.
