Small Gift Exemption, older kids, 1 gift possibly in a trust

Hello,


Myself and my husband would each like to gift our 2 children the max Small Gift Exemption of 3K per year, each. We are married . We would like to do this for the foreseeable future – basically as long as we can afford to .

As we understand it, we could gift 6K between us to each child per year.

Child A is 18 and Child B 21.

We do not wish for them to have access to this money now. We don’t see any reason for them to have knowledge about it at the moment. It’s for when they need it for first car, travel, House deposit etc.

Child B has issues which means that we may not ever wish for him to be able to access the money himself and we would be thinking of a trust of some kind for Child B .



We would be happy to invest it for each child rather than the money sitting in a savings account.



How do we go about this?

In order to gift it, does it have to be deposited into an account or investment policy in their names?

How would we set it up in trust for Child B?



Any advice would be much appreciated.

Hi FoxGate1,

Welcome to AAM.

This previous AAM thread might be relevant and worth a read:

Revenue rules that annual small gift exemption must be actually given and not just "earmarked".​

Ten years ago we decided we would like to do as you are hoping to do now, so we set up bank accounts for them (our 3 grandchildren) in their own names.
They still do not know about it. We of course told their parents.
We did not put the full 6K in each year but a nice sum has built up for them

How did you set up bank accounts for a person under 18 in their own names?
Are they joint accounts with the parent?

We set up the kids accounts on line (B of I)website. I think the only thing we needed was their PRSI numbers. As this was 10 years ago things may have changed since.
I have kept all paperwork and statements which are addressed to me. They were in primary school at the but are now in college.
The accounts are each sole name with no attachment to any adult.

BoI will eventually look for proof of ID so your 10 years of control may come to an end. And that is the issue @FoxGate, you can no longer open a bank account in the name of someone else, you need proof of ID and the small gift must be given not just set aside in the name of the recipient.

The only thing to do is give the money to your children and counsel them on the use of it. If they appear to squander it in your opinion then you can stop.