Instructions for Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return

• Legal Form Number: 709
• Year: 2023
• Issuer: Treasury Department
• Section: Treasury Department

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2023

Instructions for Form 709

United States Gift (and Generation-Skipping Transfer) Tax Return

For gifts made during calendar year 2023

Department of the Treasury

Internal Revenue Service

Section references are to the Internal Revenue Code unless

otherwise noted.

Contents Page

General Instructions ......................... 1

Purpose of Form ......................... 1

Who Must File .......................... 2

When To File ........................... 5

Where To File ........................... 5

Amending Form 709 ...................... 5

Adequate Disclosure ...................... 5

Penalties .............................. 6

Joint Tenancy ........................... 6

Transfer of Certain Life Estates Received

From Spouse ......................... 6

Specific Instructions ......................... 6

Part 1—General Information ................ 6

Schedule A. Computation of Taxable Gifts ...... 8

Gifts Subject to Both Gift and GST Taxes ....... 9

Schedule B. Gifts From Prior Periods ......... 14

Schedule C. Portability of Deceased Spousal

Unused Exclusion (DSUE) Amount and

Restored Exclusion Amount .............. 18

Schedule D. Computation of GST Tax ......... 19

Part 2—Tax Computation (Page 1 of Form

709) .............................. 21

Signature ............................. 22

Future Developments

For the latest information about developments related to Form

709 and its instructions, such as legislation enacted after they

were published, go to IRS.gov/Form709.

For Gifts Made Use Revision of

Form 709 DatedAfter and Before

– – – – – January 1, 1982 November 1981

December 31, 1981 January 1, 1987 January 1987

December 31, 1986 January 1, 1989 December 1988

December 31, 1988 January 1, 1990 December 1989

December 31, 1989 October 9, 1990 October 1990

October 8, 1990 January 1, 1992 November 1991

December 31, 1992 January 1, 1998 December 1996

December 31, 1997 – – – – – *

* Use the corresponding annual form.

What's New

•The annual gift exclusion for 2023 is $17,000. See Annual

Exclusion, later.

•For gifts made to spouses who are not U.S. citizens, the

annual exclusion has increased to $175,000. See

Nonresidents Not Citizens of the United States, later.

•The top rate for gifts and generation-

skipping transfers remains at 40%. See Table for Computing

Gift Tax.

•The basic credit amount for 2023 is $5,113,800. See Table

of Basic Exclusion and Credit Amounts.

•The applicable exclusion amount consists of the basic

exclusion amount ($12,920,000 in 2023) and, in the case of

a surviving spouse, any unused exclusion amount of the last

deceased spouse (who died after December 31, 2010). The

executor of the predeceased spouse's estate must have

elected on a timely and complete Form 706 to allow the

donor to use the predeceased spouse's unused exclusion

amount.

•Digital assets. A new question regarding digital assets

appears on Line 20. See Digital assets and Line 20. Digital

Assets, later, for information on transfers involving digital

assets. Do not leave this question unanswered. The

question must be answered by all taxpayers, not just

taxpayers who made transfers involving digital assets.

Photographs of Missing Children

The IRS is a proud partner with the National Center for Missing &

Exploited Children® (NCMEC). Photographs of missing children

selected by the Center may appear in instructions on pages that

would otherwise be blank. You can help bring these children

home by looking at the photographs and calling

1-800-THE-LOST (1-800-843-5678) if you recognize a child.

General Instructions

Purpose of Form

Use Form 709 to report the following.

•Transfers subject to the federal gift and certain

generation-skipping transfer (GST) taxes and to figure the

tax due, if any, on those transfers.

•Allocation of the lifetime GST exemption to property

transferred during the transferor's lifetime. (For more details,

see Schedule D, Part 2—GST Exemption Reconciliation,

later, and Regulations section 26.2632-1.)

All gift and GST taxes must be figured and filed on a

calendar year basis. List all reportable gifts made during

the calendar year on one Form 709. This means you

must file a separate return for each calendar year a reportable

gift is given (for example, a gift given in 2023 must be reported

on a 2023 Form 709). Do not file more than one Form 709 for any

1 calendar year.

How To Complete Form 709

1. Determine whether you are required to file Form 709.

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2. Determine what gifts you must report.

3. Decide whether you and your spouse, if any, will elect to

split gifts for the year.

4. Complete lines 1 through 19 of Part 1—General Information.

5. List each gift on Part 1, 2, or 3 of Schedule A, as

appropriate.

6. Complete Schedules B, C, and D, as applicable.

7. If the gift was listed on Part 2 or 3 of Schedule A, complete

the necessary portions of Schedule D.

8. Complete Schedule A, Part 4.

9. Complete Part 2—Tax Computation.

10.

Sign and date the return.

Make sure to complete page 1 and the applicable

schedules in their entirety. Returns filed without entries in

each field will not be processed.

Remember, if you are splitting gifts, your spouse must

sign line 18 in Part 1—General Information.

Who Must File

In general. If you are a citizen or resident of the United States,

you must file a gift tax return (whether or not any tax is ultimately

due) in the following situations.

•If you gave gifts to someone in 2023 totaling more than

$17,000 (other than to your spouse), you probably must file

Form 709. But see Transfers Not Subject to the Gift Tax and

Gifts to Your Spouse, later, for more information on specific

gifts that are not taxable.

•Certain gifts, called future interests, are not subject to the

$17,000 annual exclusion and you must file Form 709 even if

the gift was under $17,000. See Annual Exclusion, later.

•Spouses may not file a joint gift tax return. Each individual is

responsible to file a Form 709.

•You must file a gift tax return to split gifts with your spouse

(regardless of their amount) as described in Part 1—General

Information, later.

•If a gift is of community property, it is considered made

one-half by each spouse. For example, a gift of $100,000 of

community property is considered a gift of $50,000 made by

each spouse, and each spouse must file a gift tax return.

•Likewise, each spouse must file a gift tax return if they have

made a gift of property held by them as joint tenants or

tenants by the entirety.

•Only individuals are required to file gift tax returns. If a trust,

estate, partnership, or corporation makes a gift, the

individual beneficiaries, partners, or stockholders are

considered donors and may be liable for the gift and GST

taxes.

•The donor is responsible for paying the gift tax. However, if

the donor does not pay the tax, the person receiving the gift

may have to pay the tax.

•If a donor dies before filing a return, the donor's executor

must file the return.

Who does not need to file. If you meet all of the following

requirements, you are not required to file Form 709.

•You made no gifts during the year to your spouse.

•You did not give more than $17,000 to any one donee.

•All the gifts you made were of present interests.

Gifts to charities. If the only gifts you made during the year are

deductible as gifts to charities, you do not need to file a return as

long as you transferred your entire interest in the property to

qualifying charities. If you transferred only a partial interest, or

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transferred part of your interest to someone other than a charity,

you must still file a return and report all of your gifts to charities.

Note. See Pub. 526, Charitable Contributions, for more

information on identifying a qualified charity.

If you are required to file a return to report noncharitable gifts

and you made gifts to charities, you must include all of your gifts

to charities on the return.

Transfers Subject to the Gift Tax

Generally, the federal gift tax applies to any transfer by gift of real

or personal property, whether tangible or intangible, that you

made directly or indirectly, in trust, or by any other means.

The gift tax applies not only to the free transfer of any kind of

property, but also to sales or exchanges, not made in the

ordinary course of business, where value of the money (or

property) received is less than the value of what is sold or

exchanged. The gift tax is in addition to any other tax, such as

federal income tax, paid or due on the transfer.

The exercise or release of a general power of appointment

may be a gift by the individual possessing the power. General

powers of appointment are those in which the holders of the

power can appoint the property under the power to themselves,

their creditors, their estates, or the creditors of their estates. To

qualify as a power of appointment, it must be created by

someone other than the holder of the power.

The gift tax may also apply to forgiving a debt, to making an

interest-free or below-market interest rate loan, to transferring

the benefits of an insurance policy, to certain property

settlements in divorce cases, and to giving up some amount of

annuity in exchange for the creation of a survivor annuity.

Bonds that are exempt from federal income taxes are not

exempt from federal gift taxes.

Sections 2701 and 2702 provide rules for determining

whether certain transfers to a family member of interests in

corporations, partnerships, and trusts are gifts. The rules of

section 2704 determine whether the lapse of any voting or

liquidation right is a gift.

Digital assets. The gift tax applies to transfers of digital assets.

Digital assets are any digital representations of value that are

recorded on a cryptographically secured distributed ledger or

any similar technology. For example, digital assets include

non-fungible tokens (NFTs) and virtual currencies, such as

cryptocurrencies and stablecoins. If a particular asset has the

characteristics of a digital asset, it will be treated as a digital

asset for federal transfer tax purposes.

Gifts to your spouse. You must file a gift tax return if you made

any gift to your spouse of a terminable interest that does not

meet the exception described in Life estate with power of

appointment, later, or if your spouse is not a U.S. citizen and the

total gifts you made to your spouse during the year exceed

$175,000.

You must also file a gift tax return to make the qualified

terminable interest property (QTIP) election described under

Line 12. Election Out of QTIP Treatment of Annuities, later.

Except as described earlier, you do not have to file a gift tax

return to report gifts to your spouse regardless of the amount of

these gifts and regardless of whether the gifts are present or

future interests.

Transfers Not Subject to the Gift Tax

Four types of transfers are not subject to the gift tax. These are:

•Transfers to political organizations,

•Transfers to certain exempt organizations,

-2- Instructions for Form 709 (2023)