According to
IRS.gov, the federal gift tax process centers on reporting certain transfers of property (or money) made during life where the donor does not receive full consideration in return. The primary form is Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return.
What is a gift and when is tax due?
The gift tax applies to transfers of any type of property by gift. You make a gift if you give property (including money), or the use of or income from property, without expecting to receive something of at least equal value in return. Selling something for less than full value or making an interest-free/reduced-interest loan can also be a gift.
Most people never pay gift tax because of the annual exclusion and the large lifetime exemption (unified with the estate tax). Tax is generally due only after taxable gifts exceed the lifetime applicable exclusion amount.
Who must file Form 709?
U.S. citizens or residents must generally file Form 709 (even if no tax is due) if:
• They give gifts totaling more than the annual exclusion ($19,000 per donee in 2025 and 2026) to any person other than a spouse.
• They make gifts of future interests (these do not qualify for the annual exclusion, regardless of amount).
• They elect to split gifts with a spouse.
• Certain other situations apply (e.g., community property gifts, joint tenancy gifts, or specific elections).
Key exceptions / transfers not subject to gift tax (these generally do not require reporting on Form 709):
• Direct payments of tuition to a qualifying educational organization.
• Direct payments of medical expenses to the care provider.
• Gifts to a U.S.-citizen spouse (unlimited marital deduction in most cases).
• Transfers to certain political organizations or qualifying exempt organizations.
• Gifts that do not exceed the annual exclusion (present-interest gifts only).
Only individuals file gift tax returns. If a trust, estate, partnership, or corporation makes a gift, the individual beneficiaries/partners/shareholders are treated as the donors.
Nonresidents who are not U.S. citizens generally use Form 709-NA for gifts of U.S.-situs real or tangible property.
When and how to file
• Form 709 is a calendar-year return. It is generally due by April 15 of the year following the gifts (or the next business day if April 15 falls on a weekend or holiday).
• An automatic 6-month extension is available via Form 8892 (or by extending your income tax return with Form 4868/2350). An extension to file does not extend the time to pay any tax due.
• Electronic filing is available through Modernized e-File (MeF).
• Paper returns are filed with the IRS in Kansas City, MO (specific address in the instructions; private delivery services have different street addresses).
The donor is generally responsible for any tax due. If the donor does not pay, the recipient may become liable.
Basic process overview (from the Form 709 instructions)
1. Determine whether you must file.
2. Identify reportable gifts.
3. Decide whether to elect gift-splitting with a spouse.
4. Complete the form (Part I general information, Schedule A for gifts, Schedules B/C/D as needed for prior gifts, DSUE, and GST tax, and Part II tax computation).
5. Sign and file (electronically or by mail). Attach supporting documents such as appraisals when required.
Gifts reduce the remaining lifetime exemption available for future gifts or for the estate tax at death. The IRS provides detailed instructions, rate schedules, and FAQs on its site (including pages for Form 709, gift tax FAQs, and “What’s new — Estate and gift tax”).
For the most current rules, forms, instructions, and addresses, check the official IRS pages directly, as amounts (annual exclusion, lifetime exemption) and procedures can be updated. Complex situations often benefit from professional advice.
