In 2011 The Gift Tax annual exclusion remains at $13,000 per person per year for outright gifts but the exemption amount was made to be uniform with the estate tax exemption amount so there is now a $5,000,000 exemption for those who have not given prior gifts. However in prior law over the past decade the gift tax exemption was just $1,000,000. Nicholas Cage had already given over $1.8m in gifts though since 2004-2009 and the total he now owed as a result was just under $625,000. As a result they were placing a lien against him.
It is a sad situation continuing his debt of around $14 million that he had previously owed the IRS for income tax issues.
He had sued his manager who he claimed caused his financial ruin regarding those problems demanding $20m although the manager explained it was Cage's own fault and counter sued. It came out that Cage had bought $33m in real estate and 22 cars including 9 Rolls Royce. He had made $24 million in 2010 but needed to sell off many valuable assets he had in order to pay the IRS.
He has another tax situation now as he was late with paying for tax that went well beyond his exclusion amount and would have been due years ago but he forgot to pay the taxes as he was required to after having given the gifts.
This is another example of why this year is such a great year for the wealthy to pass along money to their friends and loved ones. Gift, Estate and Generation skipping taxes for this year and next year will be at a unified $5 million per taxpayer based on the agreement the President made with Congress and enacted into law.
The tax rate is currently at 35% for gift taxes above the exemption amount.
To see the TMZ.com breakdown of the amount of tax he owes for each year 2004-2009 click here
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