annual exclusion gift

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An annual exclusion gift usually involves cash, stocks, bonds, portions of real estate, or forgiving debt on a family loan in an amount that doesn't exceed the annual gift tax exclusion. The federal government sets the allowable limits for tax-free giving each year.

The annual gift exclusion amount for 2021 stays at $15,000 per donor per recipient. 

[Last updated in June of 2021 by the Wex Definitions Team]