Final answer:
The maximum amount that Betsy can transfer to Pedro without incurring transfer taxes or utilizing her applicable credit during 2022 is $15,000 per year. If she wants to transfer more than that, she can use her lifetime gift tax exemption of $12,060,000.
Step-by-step explanation:
In 2022, the maximum amount that Betsy can transfer to Pedro without incurring transfer taxes or utilizing her applicable credit is $15,000 per year as per the annual gift tax exclusion. This exclusion allows individuals to gift up to $15,000 to another person without any tax consequences.
If Betsy wants to transfer more than $15,000, she would need to use her applicable credit, also known as the lifetime gift tax exemption, which allows individuals to gift a certain amount over their lifetime without owing any gift tax. The applicable credit amount for 2022 is $12,060,000.