You will not find any reference to the 709 or 709 filing requirements in the tax code because the 709 (like other forms) are an IRS invention used to interrupt and apply the actual code as defined in various code section in chapter 12 that defines the tax, the penalties and the $15,000 exception. Other then the $15K exception, there is no other exception. The $11.4 million is not an exception to the tax, the tax is still there even though it can be credited to the $11.4 million lifetime exclusion (not exception). Even with the exclusion, the tax is still there (even though it does not have to be paid if applied to the exclusion) and can be computed on the gift which is what the penalty is based on. It is all in the code but in bits and pieces in various sections.
**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
