Earning extra income?
For Business Owners:
Deducting the Cost of Business Gifts
Business gifts can be deducted — but only up to $25 per recipient, per tax year.
Here’s what you need to know:
$25 Deduction Limit Per Recipient
You and your spouse are treated as one taxpayer, so the $25 limit applies collectively to gifts you both give to the same person.
Incidental Costs Don’t Count Toward the Limit
Costs such as Engraving, Packaging, Shipping are deductible separately as long as they don’t substantially add value to the gift.
Promotional Items Under $4 Are Fully Deductible
If the item costs $4 or less, has your business name permanently engraved,Is given out regularly
…it is not subject to the $25 limit.
Recordkeeping Matters
Keep track of who received the gift, the business’ purpose, cost and receipts. Good records help maintain compliance and avoid issues in an audit.
Gifts vs. Entertainment
If something could be considered either a gift or entertainment, the IRS will classify it as entertainment —which means no deduction.
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For Individuals:
Tax Benefits of Charitable Giving
Charitable giving offers meaningful tax benefits — but only when done correctly.
Donate Only to Qualified Organizations
Your contributions must go to an IRS-recognized
501(c)(3) charity. Always double-check the organization’s status.
No Significant Benefit in Return
If you receive something (like a tote bag, dinner, or event ticket), you must subtract the value received from your deductible amount.
Charitable Deduction Limits
1. Cash Contributions – Up to 60% of AGI
Depending on the charity and donation type, the limit may vary.
2. Non-Cash Contributions – Up to 30% of AGI
Household items, clothing, furniture, and similar goods are deductible at fair market value.
3. Carryovers
If you donate more than allowed for the year, you can carry forward excess contributions for up to five years.
Gift Taxes: A Key Part of Estate Planning
Gift giving isn’t just about generosity — it can be a powerful wealth-transfer strategy.
Annual Exclusion Gifts (Tax-Free Each Year)
For 2025, the annual exclusion amount is $19,000 per recipient. You can give this amount to any number of people without filing a gift tax return.
$38,000 per recipient for married couples
With gift-splitting, spouses can combine exclusions.
Earning extra income?
Lifetime Gift & Estate Tax Exemption
In 2025, the lifetime unified credit is:
$13.99 million per individual
Gifts above the annual exclusion simply reduce this lifetime amount. Most people will never pay actual gift tax, but filing Form 709 may still be required.
Filing Requirement: IRS Form 709
You must file Form 709 if:
You give more than $19,000 to any one person in 2025. You make certain gifts, such as split gifts, future-interest gifts, or gifts to trusts.
Filing does not mean you owe tax — it typically just tracks the use of your lifetime exemption.
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Before Your Options Narrow
Two quick questions, then your contact info. A Falcon team member will reach out to walk you
through what’s available in your specific situation.
Why Falcon Tax Resolution Group
– Former IRS employees with insider expertise
– Over 100 years of combined experience
– Proven success in tax resolution and – monitoring
– Transparent pricing and honest advice
– Nationwide representation
The Longer You Wait, the Fewer Options You Have.
Your case review is free, confidential, and comes with no obligation — just a clear picture of where things stand and what can still be done.