Q: how does a auto donation to a family member, in amount of 50,000, affect fed taxes in louisiana
A: When you donate a vehicle to a family member in Louisiana valued at $50,000, for federal tax purposes, this is considered a gift. The federal gift tax applies to gifts over $16,000 (as of 2023) per recipient per year. Amounts over this annual exclusion must be reported on IRS Form 709 by the giver, not the recipient. However, there's a lifetime exemption amount that means actual tax may not be owed until cumulative reportable gifts exceed the lifetime limit. For 2023, the lifetime exemption is $12.92 million. You should keep records of the donation and file the necessary forms with your tax return. The recipient of the gift does not need to report the gift as income. It's also prudent to consult with a tax professional for personalized advice.
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