Is There A Tax Break For Paying A Child's Student Loans?

Dear Liz: Our girl took connected important student indebtedness debt to get her master’s degree. She owes astir $60,000 and truthful acold has only been capable to activity a minimum costs job.

If my woman and I were to salary disconnected nan loans, would location beryllium immoderate taxation advantages aliases different benefits we could usage to offset nan expense?

Answer: You won’t get a conclusion for paying your daughter’s student loans and you’ll request to beryllium mindful of gift taxation rules, but that shouldn’t deter you from this generous enactment if you tin spend to help.

Education indebtedness is nan norm for today’s assemblage graduates, but a Gallup canvass recovered nan mostly opportunity their student loans caused them to hold astatine slightest 1 awesome life milestone specified arsenic buying a home, starting a business, getting joined aliases having kids. Borrowers often forgo redeeming for status successful their attempts to salary down debt, losing years aliases moreover decades of compounding and diminishing their early wealth. Student indebtedness debt besides tin create intelligence wellness burdens, starring to much depression, worry and a reduced value of life.

The yearly gift taxation exemption allows you to springiness up to a definite magnitude annually to immoderate recipient without having to record a gift taxation return. In 2026, nan limit is $19,000 per recipient, truthful you and your woman could springiness $38,000 this twelvemonth toward paying down your daughter’s student loans. The exemption astir apt will beryllium nan aforesaid aliases somewhat higher adjacent year, allowing you to wholly salary disconnected nan loans without having to record a gift taxation return.

If you wanted to salary nan full measure successful 1 go, you’d person to record nan return but you’d beryllium improbable to salary immoderate gift taxes. Gift taxes are only owed erstwhile nan amounts you springiness distant supra nan yearly exemption transcend your life property and gift taxation exemption, which for 2026 is $15 million.

Dear Liz: When my mother passed distant 9 years ago, I inherited immoderate golden coins. At nan time, it was difficult to spell done her life’s belongings and portion pinch things. Now that golden prices are truthful high, I’m wondering if it makes consciousness to waste those coins? I’m not judge holding connected to them makes a batch of sense, but would admit immoderate proposal you mightiness have.

Answer: Gold coins tin beryllium a bully hedge against ostentation arsenic good arsenic a portable root of wealth. But you request to shop them securely to defender against theft and they astir apt should beryllium insured, which tin raise nan costs of ownership.

If you want to move your coins into cash, make judge to get astatine slightest 3 quotes from different sources specified arsenic reputable coin shops and jewelers. Also talk nan waste successful beforehand pinch your taxation pro. The quality betwixt nan worth of nan coins erstwhile you inherited them and their waste value would beryllium considered a superior gain. Gold coins are taxed arsenic collectibles, which intends they’re taxable to a 28% national superior gains taxation rate.

Dear Liz: My mobility is regarding spousal Social Security. My hubby and I person been joined for adjacent to 20 years. My husband’s first woman has ne'er remarried. Could she beryllium claiming my husband’s Social Security? If so, without america knowing it? And, really will that impact my Social Security erstwhile that clip comes? Should excavation beryllium little than my husband’s, will I beryllium capable to declare my husband’s Social Security?

Answer: Strictly speaking, nary 1 tin declare anyone else’s Social Security. But personification tin declare benefits based connected nan net grounds of a spouse aliases a erstwhile spouse nether definite circumstances.

Specifically, your husband’s ex could declare a divided spousal use based connected your husband’s record, if that magnitude was greater than her ain status use and nan matrimony lasted astatine slightest 10 years. She could person up to half nan magnitude he had earned arsenic of his afloat status age. He does not request to beryllium receiving his ain use for her to person a divided spousal benefit, arsenic agelong arsenic he’s astatine slightest 62. He typically would not beryllium notified that she had applied.

Claiming specified a use doesn’t impact nan magnitude your hubby gets aliases that you mightiness beryllium entitled to. Your spousal use would besides beryllium up to 50% of nan magnitude your hubby had earned arsenic of his afloat status age. For you to get a spousal benefit, however, your hubby must person applied for his ain benefit.

Liz Weston, Certified Financial Planner, is simply a individual finance columnist. Questions whitethorn beryllium sent to her astatine 3940 Laurel Canyon, No. 238, Studio City, CA 91604, aliases by utilizing nan “Contact” shape astatine asklizweston.com.