DONORS TAX

A. Deductions/Exemptions
1. Donation by reason of Marriage or dowry up to the maximum amount
of 10,000.00 for each parent on their legitimate, illegitimate and
adopted child, given before the celebration of marriage or within one
(1) year from celebration of marriage.
- If both parents donate a property which is community/conjugal, two
separate computations with the parents sharing the gross donation
equally. Each can avail the 10,000.00 deduction.
- Cannot be availed by a non-resident alien donor.

2. Gifts to government
- Available to all donors

3. Gifts to educational, charitable, etc.

- Available to all donors
- Observe the 30% rule

4. Gifts with encumbrances assumed by donee e.g. unpaid mortgage or

unpaid taxes.
- Available to all donors
Ex: X donate a land with a Fair Market Value 100,000.00 to Y.
The
land has an existing unpaid mortgage of 40,000.00 to be
assumed by Y. The net donation is 60,000.00.
Gross Gift 100,000.00
Less: Unpaid Mortgage (40,000.00)
Net Gift 60,000.00
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