Gift splitting is a tax-related strategy that married couples in the United States can use to combine their individual gift tax exclusions and make larger tax-free gifts to individuals, such as family members or friends. The concept of gift splitting is tied to the federal gift tax system, which imposes taxes on gifts made during one’s lifetime.

Here’s an overview of gift splitting:

1. **Annual Gift Tax Exclusion:**
– In the United States, individuals are allowed to give a certain amount of money or property to another individual each year without incurring gift tax. This is known as the annual gift tax exclusion. The exclusion amount is set by the Internal Revenue Service (IRS) and is subject to adjustment for inflation.

2. **Gift Tax Exclusion Amount:**
– The current annual gift tax exclusion amount is $15,000 per person. This means an individual can give up to $15,000 to any number of individuals each year without triggering gift tax. Married couples can potentially double this amount through gift splitting.

3. **Gift Splitting for Married Couples:**
– Gift splitting allows a married couple to treat a gift made by one spouse as if it were made equally by both spouses. This effectively allows them to combine their individual annual gift tax exclusions. As a result, a married couple can jointly give up to twice the annual exclusion amount to an individual without incurring gift tax.

4. **Example of Gift Splitting:**
– For example, if one spouse wants to make a gift to their child, they could give $30,000 ($15,000 from each spouse) without triggering gift tax. This is accomplished through gift splitting. The couple doesn’t have to physically split the gift; rather, the IRS recognizes it as a joint gift.

5. **Consent to Gift Splitting:**
– Both spouses must consent to gift splitting on a federal gift tax return (IRS Form 709) filed for the calendar year in which the gift is made. Even if no gift tax is due because the amount is within the annual exclusion, filing Form 709 is necessary to elect gift splitting.

6. **Lifetime Gift Tax Exemption:**
– In addition to the annual gift tax exclusion, individuals have a lifetime gift tax exemption, which is the total amount of gifts they can make during their lifetime without paying gift tax. As of my last knowledge update, the lifetime gift tax exemption is quite substantial, but it is subject to change and should be checked with the latest IRS guidelines.

7. **Consultation with Tax Professionals:**
– Gift tax rules can be complex, and tax laws may change. Couples considering gift splitting or making significant gifts should consult with tax professionals or estate planning attorneys to ensure compliance with current tax regulations.

It’s important to note that tax laws are subject to change, individuals should check the latest IRS guidelines or consult with tax professionals for the most up-to-date information and advice tailored to their specific situations.