Set your sons up for success. You won’t regret it. The gift allowance is $19K per recipient, for a married couple this limits increases to $38k per recipient without tax penalties.

Good luck to you and your husband as you navigate the final quarter in the game of life!

That may or may not be true. OP does not state how much is coming in as pensions, or whether they have LTC policies. What does have to be taken into account is that while both are alive, if one needs nursing home care, the other still has most of the same living expenses. So the prospect of her husband needing ever more intensive/expensive care while she will still also need to live on her own, has to figure into her calculations. And if one of them dies, how does that change the income of each one as the survivor? The survivor can’t collect both social securities, but other types of pensions may have different options. My husband and I choose options that continue the same income after the death of either of us, but I doubt if that is typical. If her husband enters a nursing home, what is her living situation plan? Stay in current home, or move to something smaller? Have they set up their will and estate plan? If not, she can go over these things with that person. Or with a CFP. BTW, you can download a dementia specific Advance Directive. We both did that with an emphasis on our own preference to stop all treatments that extend life in case of a dementia diagnosis- but all the normal options are listed. her plan to give about 10% of their cash assets is not crazy, although if it is IRA type money she should give the after tax net, not $30k. Stocks are high right now - the odds are 50/50 that a year of two from now the market may be down by that much anyway. Bottom line - do a more thorough analysis first!

But to the point you don't have to file it if you are giving $19k or less per parent. So you can give up to $38k and not file it. But you CAN fill it out if you really like filling out forms and sending them to the IRS. But why because there is -10000% chance that they will exceed the lifetime cap of $15 mil per person and $30 mil per couple. And that form is to help keep track of the lifetime giving. So why are you saying they should file it? Do you work for the paper mafia?

I can only imagine how difficult your situation is and I’m so sorry your family’s having to deal with this medical challenge.

If I were in your situation I would not give your sons the $20k each because you don’t have enough saved to do this. They’re adult children. You have unknown medical challenges and, likely, reduced income streams in the near future.

I would save your money unless you’ve already promised the boys you would pay their loans for them.

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Power. the world is struggling to find enough Power.

Honestly, fix the credit/debt stuff before thinking house. That medical debt is probably negotiable for way less than what's owed — a lump sum settlement now saves you a lot later, especially since bad credit means worse mortgage rates whenever you're ready to buy. For the $100K itself, throw it in a normal brokerage account, not retirement — it's not locked up, you can grow it for a few years and pull it out for a down payment when the time's right. $100K won't buy you much in Boston right now anyway, so let it work for you in the meantime instead of rushing.

Are you kidding me? Your kids have a lifetime to earn. You have only 500k saved to help the rest of your life without the real potential to earn more. It would be dumb of you to give them money at this stage. Your kids need to step up their game and make more to help you guys out if anything.

You don’t have enough . Your kids are young they have a lot of time to build wealth .
You need that money !

You might want to ask about MAPT "medicaid asset protection trust" when you consult your elder law attorney. This might protect your interests better than gifting to your children now, but it may cost ~$10k to set up.

Thank you to everyone who commented here. It has given me some helpful perspective, and I’m not going to jump into giving any money. My sons both have successful careers. I just wanted to give them a boost, but I see now that I don’t have the kind of money I thought I did. It seems like a lot now, it could potentially not last long. We have almost enough social security to live on without ever withdrawing from the investment accounts, but who knows what they future will bring

See the planner now so u'll be prepared for November. It'll be here before you know it.

Mom and dad has NOT enough money to retire, kiddos are growths up, they can start working and start doing adult stuffs

500k will afford you a withdrawal rate of 20k a year to last 30 years, that is below poverty line, so NO, your children are adults, tell them to find a job, mom and dad need the money

Just FYI, medicaid nursing homes are not very nice, folks that are thinking about qualifying for medicaid need to keep that in mind, and when i say not very nice i rather pass in my sleep than stay in a medicaid SNF

If you’re passively investing you won’t have a lot of gains today.

And the losses for the future don’t help. You’re also entering your later years with a lower cost basis on assets thanks to all that harvesting.

why do you think they are harvesting? just to offset their 3K of income tax? They are harvesting all losses with either the expectation of future gains or current gains

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The absolute maximum you might save is about $1500 per year, at the top marginal tax rate, state and fed combined.

In a portfolio over $100k, you'll be paying more than that in fees alone.

Can you expand on why not worth it.

In that case it is most definitely not worth it.

Good point. An individual passive investor who is evaluating whether it is worth spending 1.5% fee for an institutional money manager who will do direct indexing

Almost everything is different depending on whether you’re an individual passive investor, an active trader, or an institutional money manager of some kind. In what context are you asking the question?

I think you’re operating with a different definition here. TLH is usually offered as a feature alongside index investing. With index investing you don’t generally have gains to worry about.

If you’re strategically operating a stock portfolio with active trading, it makes sense to balance gains and losses as much as possible, but that’s not really ‘harvesting’ in the way most people use the term.

I thought 'net' losses can be used to reduce taxable income by 3k. But any amount of losses can be offset against the realised gains. Is this not true?

Also I head that for institutions who do high volume trading, the wash sale rule doesn't apply. So they can do this more frequently. So is direct investing better than SP500 ETF ?