Donation Tax Rates

In general, the tax for each calendar year shall be computed on the basis of the total taxable net gifts made during the calendar year in accordance with the following schedule, if net gift is:

Over                                      Not Over

100,000           Exempt

100 ooo                               200,000            0 plus 2% of excess over 100k

200 000                             500 000        2000    plus 4 % of excess over 200k

500 000                            1 000 000       14000 plus 6% of excess over 500k

1000000                           3 000 000       44 000 plus 8% of excess over 1M

3000 000                          5 000 000        204 000 plus 10% of excess over 3M

5 000 000                         10 000 000       404 000 plus 12% of excess over 5 M

10 000 000                        XX                    1004 000 plus 15% of excess over 10M

*If donee is a stranger, the tax payable shall be 30% of the net gifts.

For purposes of tax, stranger is a person who is not a :

a. Brother, sister whether half or whole blood, spouse ancestor and lineal descendant.

b. Relative by consanguinity in the collateral line within the fourth degree of relationship.

**Tax credit for donor’s tax paid to foreign country.

Who can claim?

Only citizen or resident alien donor

Limitation on tax credit:

1st limitation

Foreign Taxable Net Gifts / Total Taxable Net Gifts X Phil Gift Tax

2nd limitation

Total Foreign Taxable Net Gifts / Total Taxable Net Gifts x Phil Gift Tax


About Jonathan Ruiz CPA

Entrepreneur, CPA Mentor, Stock market Newbie Mentor, Influential Author and Master's Degree in International Business graduate in Hult International Business School, UK. A father of two lovely daughters.
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