gift tax, parents give money to college student

Technical topics regarding tax preparation.
#1
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Is the pocket money parents give to college student child considered as gift? I know the pocket money usually won't surpass the annual gift limit even if it is considered a gift. Just curious about that.
 

#2
sjrcpa  
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It's probably considered support.
 

#3
mariaku  
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Oakland, CA
If the student is their dependent for the year, it is support. If the student is not their dependent, it is gift.
 

#4
Anderly  
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Nebraska
Not necessarily correct - it is based on state law - age of majority. See this Tax Advisor article
https://www.thetaxadviser.com/issues/20 ... -2021.html

it is also important to recognize that the federal income tax requirements for the dependency deduction fall under different rules and that a parent does not automatically have a legal obligation to provide support under state law just because the child qualifies as a dependent. It is possible to claim the adult child as a dependent under the support and other tests and still make a taxable gift in the form of the support.
 


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