Attention shoppers: Several companies have updated their return policies. According to a goTRG survey* of 500 U.S. retailers, 72% of retailers cite returns as a moderate-to-severe problem. As a result, 60% of retailers are tightening their policies, with free returns no longer the standard for 2023 holiday shopping.
HOW MUCH TIGHTER?
While shoppers say free returns are important, 66% of businesses surveyed charge something for at least some returns — up from 60% last holiday season. For 67% of companies, the fees charged are additional shipping or restocking fees. Some businesses note restocking costs so high that about 25% have turned to zero-sum refunds. Retailers are also shortening return windows to cut returns and offering incentives to shoppers who return items bought online to brick-and-mortar stores.
*Cost of Retail Returns, goTRG.com, 2023
Elizabeth gave her brother $10,000 for a down payment on a house and is considering giving him another $10,000 to help with renovations. Will either of them owe gift tax on these amounts?
The IRS considers this a gift and the general rule is any gift is taxable. However, the IRS has carved out several exceptions that make some gifts non-taxable.
The one that applies to Elizabeth is the annual exclusion. For 2021, a taxpayer can gift $15,000 per year to an individual. If the total gift is $15,000 or less, it is non-taxable to both the donor and the recipient.
Currently, the $10,000 Elizabeth gave her brother wouldn’t be taxable since it falls below the annual exclusion amount. If she chooses to gift him another $10,000 this year, then she will have to file Form 709 to report the gift and determine if any gift tax is owed.
However, if Elizabeth has a spouse, the spouse could gift the additional $10,000 to her brother. Since both Elizabeth and her spouse have each gifted less than $15,000 to her brother, there is no gift tax.
Client Profile is based on a hypothetical situation. The solutions we discuss may or may not be appropriate for you.