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You Can't Save 'Too Much' For Retirement

Although generally any gift is a taxable gift, here are some exceptions:

• Gifts that don't exceed the annual exclusion for the calendar year. For 2004, you can give up to $11,000 each to any number of people. This amount doubles, to $22,000 per recipient, in the case of a couple making such a gift.

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Tax Prep Calls for Careful Steps (The Washington Post, Mar 31, 2005)
Youth Is Fleeting, But Debt Isn't (The Washington Post, Mar 27, 2005)
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• Tuition or medical expenses you pay for someone.

• Gifts to your spouse.

• Gifts to a political organization.

• Gifts to qualifying charities, which are tax deductible.

A gift tax return is due on April 15 following the year in which the gift is made. Although a return may be required, no actual gift tax is due until the donor exceeds the lifetime taxable gift exclusion, which is $1 million.

So the parent could do one of two things. Go ahead and split the home sale proceeds among the three adult children, in which case the amount over $11,000 for each would count toward the parent's lifetime taxable gift amount. Or the parent could give each adult child $11,000 this year and the remainder of the money next year. And if the house is the parent's principal residence for the past two out of five years, up to $250,000 ($500,000 for couples who file jointly) in profit is tax-free and won't diminish the amount to be split by the children.

My wife and I have two joint checking accounts, one for monthly expenses and one for irregular expenses. I'm the sole breadwinner, and I finally realized that every time I thought of it as "my" money, I was begrudging it to the woman I promised to love, honor and cherish. She works hard to make a nice home for me and our three children.

You are absolutely right in rethinking the idea that the money you earn is "your" money.

I wish more spouses (both men and women) would have such a revelation. It shouldn't matter who makes all the money or the bulk of the money. When it comes to a marriage, it's a team effort. Think about it like this: In football, only one player can make a winning touchdown, but the entire team can and should claim the victory.

Join Michelle Singletary at 6:40 p.m. tomorrow on "Insight" with Stephanie Gaines-Bryant on WHUR, 96.3 FM. Readers can write to her at The Washington Post, 1150 15th St. NW, Washington, D.C. 20071 or send e-mail to singletarym@washpost.com. Comments and questions are welcome, but due to the volume of mail, personal responses may not be possible. Please also note that comments or questions may be used in a future column, with the writer's name, unless a specific request to do otherwise is indicated.


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