Legal Question in Wills and Trusts in Pennsylvania

In answer to your question, you can gift up to $14,000 to any one individual free of gift tax.

But there are several considerations. First, you do not indicate what assets the friend has. If he has less than $5 million (assuming he in unmarried), then there will be no estate taxes anyway. So gifting is not necessary to avoid taxation if your friend has less than that.

Second, does the friend have enough assets to take care of his financial needs? He cannot give away his stuff and then go on Medicaid. There is a 5-year lookback period for Medicaid. Will your friend be needing to go on Medicaid at any point in the next 5 years? If your friend will need to be in a nursing home, how will friend pay for it? Does he have enough assets? Nursing homes can vary in cost but I would figure on the friend needing $3000 (this is very low) to $5000 a month. How old is the friend?

If I were you, I would be consulting an elder care attorney. If the power of attorney was drafted by a lawyer, it probably says something like you may make gifts if advisable for tax purposes. It does not say that gift-giving is mandatory. There are other considerations besides the ones I pointed out. An attorney can look at your friend's whole picture and advice you if gifting is something that should or should not be considered.