The term “gift” is a legal term that is often used in relation to the transfer of ownership of an item. Essentially, a gift is a voluntary act that involves the transfer of ownership from one person to another without any contractual agreement or the exchange of money.
For example, a person may give a gift to a family member in the form of a piece of jewelry or a beloved heirloom. This act would be considered a gift, as no money has been exchanged, and while the giving of the gift may signal a long lasting relationship, it is not necessarily binding in any way.
Gifts and Tax Implications
In the United States, gifts which are greater than the annual exclusion (currently set at $15,000) are subject to gift tax. That being said, it is important for those making the gift and those receiving the gift to be aware of the tax implications that can arise from such transfers.
It is also important to note that gifts given for the purpose of funding educational or medical expenses may not be subject to Gift Tax, and it is wise to speak to a qualified financial or legal professional prior to making such transfers.
Conclusion
In conclusion, “gift” is a legal term that describes the voluntary transfer of an item from one individual to another without exchange of money or contract. It is important to be aware of the tax implications involved in making such transfers, as well as any special exemptions that may be available for educational or medical gifts.