topic Re: Form 709 in Retirement tax questions

Form 709

jlavs — Tue, 04 Mar 2025 18:46:11 GMT

My husband and I have a revocable family trust that owned 1/2 interest in a piece of residential real estate with. My husband's sister owned the other half. We deeded our half interest to her in 2024 so we are required to file Form 709 as the amount of the value of the 1/2 interest exceeded the $18,000 annual exclusion. Does this mean that the balance is a taxable event to us now or does this form simply collect data until we exceed the lifetime exclusion of $6 million? And what are the pros and cons of considering all transfers to third party as made one half by each of us.

Re: Form 709

Hi Palms — Tue, 04 Mar 2025 19:17:02 GMT

Not a taxable event for you unless you exceed the lifetime exemption....which was $13.61 million for 2024.

No choice as to how to transfer gifts if the gifted property is owned by you and your husband in equal shares.

You each give 1/2, for example, and report the share you each gave on separate 709s. The excess above the annual gift tax exclusion just reduces your lifetime exemption.

Re: Form 709

jlavs — Tue, 04 Mar 2025 21:16:20 GMT

Thank you. A follow up question. A gift to a sibling would not be considered a skip or indirect skip, right? So I would use Schedule A Part 1 Gifts subject only to tax, correct?

Re: Form 709

Hi Palms — Tue, 04 Mar 2025 21:21:39 GMT

@jlavs wrote:
A gift to a sibling would not be considered a skip or indirect skip, right? So I would use Schedule A Part 1 Gifts subject only to tax, correct?

That is right. A skip person is more than one generation younger, which usually means gifts to grandkids and the like.