Gift Taxes and the Oscars
A gift tax is a tax on the market value of a gift which can be a physical object, money or property. Additionally, the giver of the gift must give the gift with no hopes of getting anything in return except of course a “thank you” hopefully.
Most people do not have to deal with the tax on gifts because the threshold is $15,000 per giftee in the 2020 tax year. This means you can give up to $15,000 to a bunch of different people without having to file a gift tax return. However, in your lifetime you can only give up to $11.58 million in gifts until you will be subject to the gift tax. That’s right, you don’t usually have to pay taxes on your gifts until you go over that $11.58 million threshold, but there will be definitely some paperwork if you go over the yearly gift threshold.
There are some interesting cases of when the gift tax does not apply; for example, the gift bags at the Oscars. Celebrities who receive a gift bag at the Oscars must report the gift as income. It is reported as income because the companies who give out the gifts are not doing it out of the kindness of their hearts. The companies are hoping the celebs will use to product or experience which will then promote the company the gift came from.
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Learn more about gift taxes from Tina Orem.
Also, you can learn more about gifts and the Oscars from Robert Wood.
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