Question

Celeste and Raymond have been married for 29 years. Last year, Raymond sold his extremely successful automotive repair shop and his net worth now exceeds $40 million dollars. Celeste and Raymond have twin daughters, Kelly and Shelly, who will be 35 next month. Celeste and Raymond, neither of whom have given any gifts in the past, would like to give their daughters the maximum amount of cash possible without paying any gift tax. How much can Celeste and Raymond give to Kelly and Shelly during 2022?

A. $64,000.
B. $4, 769,800
C. $24,120,000
D. $24,184,000

Answer 1

Celeste and Raymond can each give up to $16,000 to both Kelly and Shelly under the 2022 annual gift tax exclusion. Since there are two daughters, they can give a combined total of $64,000 without paying any gift tax.

Step-by-step explanation:

The question pertains to the U.S. federal gift tax laws and regulations, which for 2022 allowed an individual to give up to $16,000 per year to another person without incurring any gift tax liability, this is known as the annual exclusion. Since neither Celeste nor Raymond has given any gifts in the past, they can each give $16,000 to both Kelly and Shelly. So, for each daughter, they can combine their exclusions for a total of $32,000 from both parents ($16,000 from Celeste and $16,000 from Raymond).

Let’s calculate the total amount Celeste and Raymond can give to their daughters without paying any gift tax:

• 
  
• $32,000 per daughter from both parents
• 
  
• Two daughters – Kelly and Shelly
• 
  
• Total = $32,000 per daughter x 2 daughters = $64,000

Therefore, the maximum amount of cash Celeste and Raymond can give to Kelly and Shelley during 2022 without incurring any gift tax is $64,000 in total.