Is the amount calculated with a gift tax calculator the same as the actual tax?

Hello. I am an attorney specializing in inheritance at Daeryun Law LLC.

Since you are facing a gift that includes both real estate and cash, you are likely giving much thought to calculating the tax amount.

To answer directly, the amount produced by a gift tax calculator may differ from the amount actually payable, so caution is needed.

You will usually enter the officially assessed land price or an arbitrary amount into the calculator, but the tax authorities primarily apply the 'market price,' such as the price of comparable sales around the date of the gift or an appraised value.

In particular, recently there have been frequent cases in which the price of similar transactions within an apartment complex is recognized as the market price, resulting in a much higher tax than expected.

In addition, whether gifts within the past 10 years are aggregated is also important.

Because the gift tax has a progressive structure, if there is any property received from your parents before this gift, it must all be aggregated and the tax base recalculated.

Because many gift tax calculators compute only this round of gifting on its own, for those with a past record, the tax rate bracket may rise at the time of the actual filing and the tax may increase sharply.

The final problem is the omission of complex deductions and tax items.

In the case of an 'onerous gift,' where cash and real estate are mixed or where the real estate includes a mortgage loan or a jeonse deposit, not only the gift tax but also the capital gains tax must be reviewed together.

In addition, if the tax credit for filing or other personal deduction items are not precisely reflected, the calculator's result may be inaccurate.

Therefore, it is safer to use a gift tax calculator only as a reference for gauging a rough budget, and at the actual filing stage to go through a specific valuation of the assets and a review of the applicable law.

If necessary, we recommend deriving the exact tax amount through a consultation with an attorney specializing in inheritance and a tax accountant.