Gift Tax Return

DEFINITION of 'Gift Tax Return'

A federal tax form that must be filled out by any individual who gives a gift that exceeds the annual or lifetime exempt gift amount established by the IRS. For example, if the annual gift tax exemption is $13,000 per recipient, anyone who gives a gift worth $13,001 or more to a single recipient will have to fill out a gift tax return. The return must be filled out because gifts above the exempt amount are subject to a gift tax.

BREAKING DOWN 'Gift Tax Return'

Unless special arrangements have been made, it is always the gift giver, not the recipient, who is responsible for paying the gift tax and for filing the gift tax return. The gift tax return is IRS Form 709. In order to avoid the gift tax, many people choose to engage in estate planning, which involves the use of a financial planner, tax professional and/or attorney to strategically choose when, how and who gets the estate owner's money.

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RELATED FAQS
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  2. If a parent transferred a house deed to their three adult children, do they need ...

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  3. How can my husband inherit a house deed?

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  4. Who will pay taxes on my grandmother's home?

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