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The income thresholds that trigger some important taxes are changing in 2023, the IRS has announced.

The agency is making the changes to account for inflation. The moves will mostly impact wealthy taxpayers, although some folks in the middle class also likely will benefit.

Following are definitions of the three key taxes that are impacted and explanations of what will be new in 2023.

What is the gift tax?

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When you give a certain amount of money or other property to someone, it is considered a gift — whether or not you intended it that way. Such gifts are subject to a tax. Here is how the IRS defines the gift tax:

“The gift tax applies to the transfer by gift of any type of property. You make a gift if you give property (including money), or the use of or income from property, without expecting to receive something of at least equal value in return. If you sell something at less than its full value or if you make an interest-free or reduced-interest loan, you may be making a gift.”

Typically, the person giving the “gift” is responsible for paying the tax. In 2022, giving property to someone that exceeds $16,000 in value makes the transfer subject to the gift tax.

There are several situations…

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