How do I give money to a college student and get a tax break for it?

Question

He is not immediate family, but is loved like he is. He is a college student VCU. Is there any method out there where the cash given can be done where it would be a non taxable event?

Answer 1

I agree the 529 plan is something you should investigate but the easiest way would be to just pay his school directly. Whip out the ole' checkbook and start signing.

This way he never receives the money and never has to pay taxes on it or count it as income.

Your question and your description are a bit different in the situations.  Regarding "get a tax break" on your giving money to a college student would not be easy because you can't get tax breaks for donating money to an individual (college student or not).  You could donate money to the schools Foundation.  But then there is no guarantee your friend would get any money.

Answer 2

look into the 529 plan for your state.  

Answer 3

The IRS allows you a one time gift per calander year of up to $11,000. If the person is married you can give up to $22,000 (11k per person). If you are married your spouse can give an additional 11k per person. Thats a grand total of up to $44,000 to the couple from you and yours. Alternatively, you can gift you the whole amount at once and use part of your $1 million lifetime exclusion to shield the difference from gift tax. But since you would exceed the $11,000 per year annual exclusion, you would have to file a gift tax return on Form 709.