Transfer tax planning is the deliberate action of a wealthy individual to pass part of the wealth to the descendants without transferring tax obligation to them. It is lawful, and the limits for transfer provided by law must be adhered to unless the donor is willing to pay taxes on the donation given. Serial gift taxes were imposed to limit donations or gifts of value to avoid payment of taxes and payable by the giver to avoid unnecessary inconveniences to the receiver (Spilker et al., 2020). Though in some instances, the receiver is liable to pay federal taxes. In 2020 as well as 2019, the annual gift limit is $15000 per recipient.
It is critical to understand the client's financial position to determine if a wealth transfer plan can be executed through serial gift taxes. I would ask the client to explain their current wealth levels to warrant issuing gifts considering the amount of money they might need in the future to support their lives. Another question my interest would be drawn to is the age of the client. The serial gift is not an ideal way of passing wealth if the property in question has already attained maximum appreciation levels in the past and for individuals who are not expected to live long.
Delegate your assignment to our experts and they will do the rest.
A Christian approach to transfer tax planning is a morality issue. The doctrine of the Catholic faith alludes that the avoidance of taxes is a sin. Other Christian scholars have argued that tax avoidance is not always illegal or unethical when evasion is for taxes imposed on live necessities (McGee, 2011) . However, the serial gift tax is not imposed on the basics of life but on wealth inheritance, which, therefore, as a Christian, be immoral to plan on avoiding it. It is not an unjust tax.
My experience is that people are always inclined to look for ways to avoid payment of taxes which whether they are Christians or not; they are always ready to undertake transfer tax planning. Some have argued that taxes were paid on the wealth they have and thus should not expose it to further taxation just because they share it with close family members inform of a gift or a donation.
References
McGee R.W. (2011) Christian Views on Tax Evasion. In: The Philosophy of Taxation and Public Finance. Springer, Boston, MA. https://doi.org/10.1007/978-1-4419-9140-9_6
Spilker, B., Ayers, B., Lewis, T., Weaver, C., Barrick, J., Robinson, J., & Worshman, R. (2020). Taxation of Individuals and Business Entities (21st ed.). Mc Graw - Hills.
