Final answer:
Martina's total annual exclusion for nontaxable gifts in 2018 is $240,000, which corresponds to a $15,000 gift to each of 16 recipients (5 children, their 5 spouses, and 6 grandchildren). The gifts made on January 2, 2019, are not included in the 2018 total. Option e.
Step-by-step explanation:
The question asks about the total annual exclusion for nontaxable gifts for Martina in 2018 when she makes gifts to her family. In 2018, the annual exclusion for gifts was $15,000 per recipient. Martina gives $15,000 to each of her five children, their spouses, and her six grandchildren, which totals 16 recipients (5 children + 5 spouses + 6 grandchildren). For 2018, she would thus have gifted $15,000 x 16 recipients = $240,000 without incurring a gift tax. Since the gifts were made to each individual separately and not to the couples jointly, each one benefits from their own $15,000 exclusion. Therefore, the answer is e. $240,000, representing the total annual exclusion Martina can claim for 2018's giftings. Repeat gifts made on January 2, 2019, would apply to the annual exclusion for 2019, not 2018, and thus are not included in the total for 2018.