How to Gift Money for a Home Purchase 🏡💰 | Gift Tax Tips for First-Time Buyers 🎁

Описание: Hey everyone! I’m Kelly Ham, The Dancing Broker! Today, we’re diving into how parents, grandparents, and close family friends can help first-time home buyers by gifting funds for a down payment or closing costs. This generous act can make a huge difference in turning the dream of homeownership into a reality.

While Washington State doesn’t have a gift tax, there are important federal rules to know. I’ll break down everything you need to know to make sure your financial gifts stay tax-efficient and compliant.

What You’ll Learn:
✔ Washington State Gift Tax Rules – No state gift tax means you can give money freely without state tax concerns.
✔ Federal Gift Tax Limits – You can gift up to $18,000 per person, per year without triggering a federal gift tax.
✔ Lifetime Federal Gift Tax Exemption – With a $13.61 million lifetime exemption, most people won’t ever pay gift tax.
✔ Multiple Family Contributions – How multiple family members can combine gifts to help first-time buyers secure up to $144,000 or more.
✔ Gift Letters – Why first-time buyers might need to provide a gift letter to their mortgage lender to show the funds are a family gift.
✔ Work with a Tax Professional – Every situation is unique. Always consult a tax expert to ensure your gift is tax-efficient and properly documented.

Example of Family Gifting:
Here’s how families can combine their efforts to help:

Mom gifts $18,000 to her child and $18,000 to her child’s spouse = $36,000
Dad does the same, bringing the total to $72,000
If grandparents contribute similarly, the couple could receive up to $144,000 in financial gifts without exceeding gift tax limits!
Why This Matters: Gifting for a home purchase is a powerful way to help loved ones build equity and avoid additional debt. These contributions can significantly reduce the financial burden for first-time buyers, making homeownership more accessible.

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