Key Takeaways
- A retired couple in their 60s called The Ramsey Show this week about giving each of their three kids up to $100,000.
- If each spouse gives each child $19,000 of their own money this year and $20,000 in January, each child gets $78,000 with no gift tax return. That’s $234,000 across all three kids.
- The annual gift exclusion is $19,000 per recipient for 2026 and goes up to $20,000 for 2027.
- The last $22,000 for each child needs a Form 709. So does any gift the couple splits between them. But filing doesn’t by itself mean anyone owes gift tax.
If you’re planning a big cash gift to your kids, you can give more of it without filing a gift tax return by giving part this December and part in January. And next year, the IRS lets each giver hand over a bit more.
That’s good news for any parent with a big gift in mind, and one couple on The Ramsey Show has a very big one.
Up to $100,000 for each kid
A retired man called into The Ramsey Show this week with a plan most kids would love to hear about. “My wife and I are in our 60s and retired and we want to give a substantial gift of money to each of our three kids,” he said. It started with one of them wanting to buy a house, and he’d been thinking of up to $100,000 for each of them.
His worries were mostly about the kids. He wondered whether that much money would overwhelm them. He also wasn’t sure whether his youngest, who’s 24 and changes jobs every couple of years, should get his share now or later. But the paperwork matters on a gift that size too, since $100,000 to one person in one year is far more than a giver can hand over without filing a return.
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Each parent gets $19,000 per child this year
For gifts made in 2026, you can give each person up to $19,000 without it counting as a taxable gift, and the limit applies separately to each person you give to. If you give one person (other than your spouse) more than that in a year, you generally must file a gift tax return, Form 709. Next year, the limit goes up to $20,000 for gifts made in 2027.
The giver files the return, and spouses can’t file a joint one, so each parent’s gifts count against the limit separately. A couple can’t just treat one spouse’s money as both of theirs, either. Splitting a gift between spouses takes a return, whatever its size.
Four gifts, $78,000 a child
So let’s say each spouse gives from their own money. If each of them gives each child $19,000 this year, each child has $38,000 by Dec. 31, with no return. Then in January, each parent gives each child $20,000 under next year’s limit, for another $40,000 per child:
| Gift from | Husband | Wife | Each child gets |
|---|---|---|---|
| 2026 | $19,000 | $19,000 | $38,000 |
| January 2027 | $20,000 | $20,000 | $40,000 |
| Total | $39,000 | $39,000 | $78,000 |
Source: IRS gift tax FAQ and IRS tax year 2027 inflation adjustments.
That’s $78,000 for each child, and $234,000 across all three, with no gift tax return for either parent. The two rounds don’t have to be a year apart, as long as they fall in different calendar years. So the child shopping for a house could have most of the money within a couple of months.
The last $22,000 takes a return
That leaves each child $22,000 short of the full $100,000. Whatever year it’s given in, it puts that child’s gifts over the limit, so whichever spouse gives it files a Form 709. If it all comes from one spouse, only that spouse has a return to file. A return isn’t a tax bill, though: having to file Form 709 doesn’t by itself mean anyone owes gift tax.
The youngest’s share needs a second look. Certain gifts, which the IRS calls future interests, get no annual exclusion at all, so they need a Form 709 even under $19,000. If his parents set his money aside for later instead of handing it to him, they’ll want to know whether that counts as a future interest before counting on the $78,000 for him.
Frankly, I’d give the $78,000 and not sweat the rest. One return for the last $22,000 is a small price for getting a down payment to a kid while they’re still house hunting. And if the house can wait, the last $22,000 could go under a later year’s limit instead, once the IRS sets it.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
