ST. PAUL, Minn. (AP) — A state gift tax is set to take effect Monday that imposes a 10 percent tax on gifts worth more than $14,000 to a single recipient in a single year.
However, a St. Paul Pioneer Press report (http://bit.ly/10rGrSt ) says the tax only kicks in after people give gifts worth more than $1 million. That means most residents probably won’t notice the new tax.
Those who are likely to be affected are those who transfer items such as lake homes and family businesses to relatives.
Gifts between spouses are exempted from the tax. So are charitable contributions and certain direct payments made on medical bills or educational expenses.
The state Department of Revenue predicts the new tax will generate about $13.5 million next year.
Information from: St. Paul Pioneer Press, http://www.twincities.com