Below are some of the more common questions and answers about Gift Tax issues. You may also find additional information in Publication 559 or some of the other forms and publications offered on our Forms page. Included in this area are the instructions to Forms 706 and 709. Within these instructions, you will find the tax rate schedules to the related returns. If the answers to your questions can not be found in these resources, we strongly recommend visiting with a tax practitioner.
The donor is generally responsible for paying the gift tax. Under special arrangements the donee may agree to pay the tax instead. Please visit with your tax professional if you are considering this type of arrangement.
Any transfer to an individual, either directly or indirectly, where full consideration (measured in money or money's worth) is not received in return.
The general rule is that any gift is a taxable gift. However, there are many exceptions to this rule. Generally, the following gifts are not taxable gifts.
In addition to this, gifts to qualifying charities are deductible from the value of the gift(s) made.
Making a gift or leaving your estate to your heirs does not ordinarily affect your federal income tax. You cannot deduct the value of gifts you make (other than gifts that are deductible charitable contributions). If you are not sure whether the gift tax or the estate tax applies to your situation, refer to Publication 559, Survivors, Executors, and Administrators.
The annual exclusion applies to gifts to each donee. In other words, if you give each of your children $18,000 in 2024, the annual exclusion applies to each gift. The table below shows the annual exclusion amount applicable in the year of the gift.
Annual Exclusion per Donee for Year of Gift
Each spouse is entitled to the annual exclusion amount on the gift, as shown in the table.
Annual Exclusion per Donee (One Spouse/Two Spouses)
| Year of Gift | Annual Exclusion per Donee | Annual Exclusion Total per Donee (from 2 spouses) |
|---|---|---|
| 2011 through 2012 | $13,000 | $26,000 |
| 2013 through 2017 | $14,000 | $28,000 |
| 2018 through 2021 | $15,000 | $30,000 |
| 2022 | $16,000 | $32,000 |
| 2023 | $17,000 | $34,000 |
| 2024 | $18,000 | $36,000 |
For information on gift splitting, see Gifts to Donees Other Than Your Spouse in the Instructions to Form 709.
Refer to Form 709 PDF , 709 Instructions and Publication 559. Among other items listed:
For the mailing address for a supplemental Form 709, see Filing Estate and Gift Tax Returns.
Fair Market Value is defined as: "The fair market value is the price at which the property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or to sell and both having reasonable knowledge of relevant facts. The fair market value of a particular item of property includible in the decedent's gross estate is not to be determined by a forced sale price. Nor is the fair market value of an item of property to be determined by the sale price of the item in a market other than that in which such item is most commonly sold to the public, taking into account the location of the item wherever appropriate." Regulation §20.2031-1.
The Internal Revenue Service cannot make recommendations about specific individuals, but there are several factors to consider:
For most simple, small transfers (less than the annual exclusion amount) you may not need the services of a professional.
However, if the transfer is large or complicated or both, then these actions should be considered; It is a good idea to discuss the matter with several attorneys and CPAs or EAs. Ask about how much experience they have had and ask for referrals. This process should be similar to locating a good physician. Locate other individuals that have had similar experiences and ask for recommendations. Finally, after the individual(s) are employed and begin to work on transfer matters, make sure the lines of communication remain open so that there are no surprises.
Finally, people who make gifts as a part of their overall estate and financial plan often engage the services of both attorneys and CPAs, EAs and other professionals. The attorney usually handles wills, trusts and transfer documents that are involved and reviews the impact of documents on the gift tax return and overall plan. The CPA or EA often handles the actual return preparation and some representation of the donor in matters with the IRS. However, some attorneys handle all of the work. CPAs or EAs may also handle most of the work, but cannot take care of wills, trusts, deeds and other matters where a law license is required. In addition, other professionals (such as appraisers, surveyors, financial advisors and others) may need to be engaged during this time
You do not have to be present during an examination unless IRS representatives need to ask specific questions. Although you may represent yourself during an examination, most donors prefer that the professional(s) they have employed handle this phase of the examination. You may delegate authority for this by executing Form 2848 "Power of Attorney."
You have many rights and avenues of appeal if you disagree with any proposals made by the IRS. See Publication 1 and Publication 5 PDF for an explanation of these options.
The general rule is that your basis in the property is the same as the basis of the donor. For example, if you were given stock that the donor had purchased for $10 per share (and that was his/her basis), and you later sold it for $100 per share, you would pay income tax on a gain of $90 per share. (Note: The rules are different for property acquired from an estate).
Most information for this page came from the Internal Revenue Code: Chapter 12--Gift Tax (generally Internal Revenue Code §2501 and following, related regulations and other sources)
For federal tax purposes, the terms “spouse,” “husband,” and “wife” includes individuals of the same sex who were lawfully married under the laws of a state whose laws authorize the marriage of two individuals of the same sex and who remain married. Also, the Service will recognize a marriage of individuals of the same sex that was validly created under the laws of the state of celebration even if the married couple resides in a state that does not recognize the validity of same-sex marriages.
However, the terms “spouse,” “husband and wife,” “husband,” and “wife” do not include individuals (whether of the opposite sex or the same sex) who have entered into a registered domestic partnership, civil union, or other similar formal relationship recognized under state law that is not denominated as a marriage under the laws of that state, and the term “marriage” does not include such formal relationships.
Gifts to your spouse are eligible for the marital deduction.
For further information, including the timeframes regarding filing claims or amended returns, see Revenue Ruling 2013-17.
The IRS will provide an account transcript for gift tax returns when Form 4506-T, Request for Transcript of Tax Return, is properly completed and submitted with substantiation. The transcript may be requested via fax or by mail using Form 4506-T. Upon receipt and verification (including matching current taxpayer and taxpayer representative records with the information on the submitted Form 4506-T), a hardcopy transcript will be mailed to the address of record. Incomplete or unsubstantiated requests will be rejected, and a Notice will be sent to the Requester. No fees apply.
Form 4506-T, Request for Transcript of Return, and instructions PDF are available on IRS.gov. Form 4506-T has multiple uses and special attention must be taken when completing the form for a gift tax inquiry. Complete the form using the printed instructions paying close attention to the following:
Lines 1a and 1b: Enter the Donor's information including an SSN.
Lines 2a and 2b: Leave blank.
Line 3: Enter Donor's current address if living; estate representative's name, title and address if donor is deceased. The address provided must match the official IRS record.
Line 4: Leave blank.
Line 6: Enter "Form 709."
Line 6 a-c: The ONLY option available for gift tax is 6b. DO NOT make any other selections in items 6-8.
Line 9: Enter the tax period (MMDDYYYY). If the tax period is unknown, refer to the "Written Requests" section below.
Line for Attestation Clause: The requester must read and agree to the attestation clause on Form 4506-T. This box must be checked to have Form 4506-T processed.
Signature/Title Requirements: The Requester must be authorized to receive the information. If the taxpayer listed on Line 1 is the Requester, no further documentation is necessary. If the Requester is other than the taxpayer shown in Line 1, the Title portion of the signature section must be completed and substantiated; see Documentation below.
Documentation: Please note that in every situation, the individual making the request for information must be authenticated.
General Tip: Altered forms will not be accepted. This includes white out, pen and ink changes, or type overs of any kind.
The instructions for Form 4506-T provides a chart directing where to mail or fax the request based upon the state in which the taxpayer was domiciled. Choose the RAIVS Team in either Ogden, UT or Cincinnati, OH.
It is also acceptable to send a written request to the IRS to secure a gift tax transcript. This method should be reserved for taxpayer's that do not have record of which tax year(s) a gift tax return was filed. The written request must include language requesting a determination of "All Gift Tax Returns Filed" for the taxpayer. Use the same fax number or mailing address provided in the Form 4506-T Instructions. The requester must be substantiated with documentation as outlined above for a request using Form 4506-T. Unsubstantiated requests will be rejected.
A Note about Form 2848, Power of Attorney
Please be advised that a duplicate, incomplete, and/or unsubstantiated Form 2848 can result in a rejection of information requests. These tips are provided to reduce the potential for rejection of Form 4506-T.
The IRS will provide a copy of a gift tax return when Form 4506, Request for Copy of Tax Return, is properly completed and submitted with substantiation and payment. Upon receipt and verification (including matching current taxpayer and taxpayer representative records with the information on the submitted Form 4506-T), a copy of the original tax return will be mailed as requested. Incomplete or unsubstantiated requests will be rejected and a Notice will be sent to the Requester. See the current Form 4506 for the applicable fee per return.
Form 4506, Request for Copy of Tax Return, is used to request a copy of previously filed tax returns with all attachments. The form and instructions are available on IRS.gov. Form 4506 has multiple uses and special attention must be taken when completing the form for a gift tax inquiry. Complete the form using the printed instructions paying close attention to the following:
Lines 1a and 1b: Enter the Donor's information including an SSN.
Lines 2a and 2b: These lines should remain blank.
Line 3: Enter Donor's current address if living; estate representative's name, title and address if donor is deceased.
Line 4: Leave blank.
Line 5: Enter a third party name and address to receive a copy of the requested information, if appropriate. This line may be left blank if the requester does not want third party involvement.
Line 6: Enter "Form 709."
Line 7: Enter up to eight tax periods per form using this format MM/DD/YYYY.
Line for Attestation Clause: The requester must read and agree to the attestation clause on Form 4506. This box must be checked in order to have Form 4506 processed.
Signature/Title Requirements: The Requester must be authorized to receive the information. If the taxpayer listed in Line 1 is the Requester, no further documentation is necessary. If the Requester is other than the taxpayer shown in Line 1, the Title portion of the signature section must be completed and substantiated; see Documentation below.
Documentation: Please note that in every situation, the individual making the request for information must be authenticated.
General Tip: Altered forms will not be accepted. This includes white out, pen and ink changes, or type overs of any kind.
The instructions for Form 4506 provide a chart directing where to mail the request based upon the state in which the taxpayer was domiciled. Choose the RAIVS Team in either Ogden, UT or Cincinnati, OH.
Make your check or money order payable to "United States Treasury." Enter the Donor's SSN and "Form 4506 Request" on the check or money order. Allow 75 calendar days for the IRS to process the request for a copy of a tax return.
A Note about Form 2848, Power of Attorney
Please be advised that a duplicate, incomplete, and/or unsubstantiated Form 2848 can result in a rejection of information requests. These tips are provided to reduce the potential for rejection of Form 4506.
Individuals taking advantage of the increased gift tax exclusion amount in effect from 2018 to 2025 will not be adversely impacted after 2025 when the exclusion amount is scheduled to drop to pre-2018 levels. For more information, see the related Tax Reform page.
To make an electronic payment, which is encouraged, go to How do I make an electronic payment?
To make payment by paper check, make the check payable to “United States Treasury.” Note the decedent’s name, social security number, and “Form 706” on the face of the check. Mail the check to:
Internal Revenue Service
1973 Rulon White Blvd.
Ogden, UT 84201
There are two separate systems for making an electronic payment of estate or gift tax:
Electronic Federal Tax Payment System (EFTPS)
Instructions on how to use the Electronic Federal Tax System (EFTPS) are found in Publication 4990 PDF (do not use Publication 4990 for the same-day wire payment method).
What you need to know about EFTPS:
Same-Day Wire Payment
What you need to know about making a same day wire payment:
If you encounter problems making a payment using these codes, please call Federal Tax Collection Service (Same-Day Wire) Customer Service at 800-382-0045 or 314-425-1810 between 8:30 a.m. to 7 p.m. Eastern Time, Monday through Friday.
If you have suggestions or comments (or suggested FAQs) for the Estate and Gift Tax website, please contact us. We will not be able to respond to your email, but will consider it when making improvements or additions to this site.