Question

The Wrights live in Texas, where Maria Wright has had an extremely successful cattle business for a number of years. As a very generous person, how much money can Maria give to her spouse, a Canadian citizen, in 2019 without incurring gift tax consequences?

1) 100,000
2) 15,000
3) Unlimited
4) A limited amount because her spouse is not a U.S. citizen

Answer 1

Maria Wright can give up to $155,000 to her Canadian spouse in 2019 without incurring gift tax consequences. This is due to the annual exclusion limit for gifts to non-U.S. citizen spouses.

Step-by-step explanation:

The question relates to U.S. gift tax laws, specifically regarding how much money Maria Wright can give to her non-U.S. citizen spouse in 2019 without incurring gift tax. For gifts to a spouse who is not a U.S. citizen, there is an annual exclusion limit; in 2019, this limit was $155,000. Therefore, Maria can give her Canadian spouse up to $155,000 without any gift tax consequences. It's important to note that this amount is indexed for inflation and can vary from year to year.

It's also worth noting that the Supreme Court case United States v. Windsor addressed the estate tax exemption for surviving spouses and its relation to the Defense of Marriage Act (DOMA), ruling in favor of equal federal rights for same-sex married couples, but that case is not directly related to the annual exclusion for gifts to non-U.S. citizen spouses.