New 2009 IRS Gift Limit Announced

The IRS recently announced an increase to it's annual gift limit, also known as the "annual exclusion," for the 2009 tax year. The new IRS gift limit will be $13,000 per year, per person.

For those unfamiliar with the IRS gift limit, it's the amount that any one person can give to a non-spouse in any one year, without incurring a gift tax. For practical purposes, a married couple can each give the full IRS gift limit, for a total of $26,000, to a recipient without violating gift tax rules.

The IRS gift limit effectively restricts the amount of money that can be placed in a college account for a child by any one person in any single year. However, Section 529 plans do allow an acceleration of five years' worth of gifts (totaling $65,000) as long as certain conditions are met.

To learn more, take a look at this extended write-up on the IRS gift limit.

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