Gift tax question and purpose of Form 709

[11156]

I am planning  on giving a gift of cash to a family member that exceeds the annual amount of $30k for MFJ. If my reading of the info on IRS Form 704 for Gift Tax, while I will need to claim the amount over the $30k on that form, i will not be required to pay a tax on it. Instead I can elect to have  that be counted against my lifetime estate tax of $11.58 million.

Is that an accurate understanding?

thank you.

[DoninGA]

You can gift up to $15,000 to one individual and your spouse can gift up to $15,000 to one individual and neither of you would be required to file a Form 709.

If the amount is greater than $15,000 from either or both of you then whomever gifts over the exclusion amount has to file a Form 709.  No taxes will be due on the gift given if the lifetime amount of all gifts ever given is not greater than $11.58 million.

[11156]

Thanks @DoninGA  for confirming my understanding. But just a nit: you are separating the individual limits. But since the joint limit is $30k, are you saying that 2 separate forms would need to be submitted, dividing the excess above $30k between them both? As I hope I noted in my post, the gift will exceed the $30k joint gifting limit, so i assume we just need to file one Form 709 for us both (since we file jointly) for the amount over the $30k annual limit...right?

[VolvoGirl]

How much more?  Have you given it yet?  Can you break it up and do 30,000 this year and then more in January next year?

[GeorgeDenseff]

You can submit one form that is for both spouses.  But you put in the fill value of the gift, not just the portion over $15,000 or $30,000.   If you are giving $50,000, for example, then you put $50,000.

[11156]

ideally that is the plan. however, I am waiting for probate to complete on an estate, and it is uncertain if the funds will be distributed to the beneficiaries before year end. We will be gifting to a family  member from my portion of the inheritance, and we  don't want to gift until those funds are distributed. so  yes, $30k this and a similar amount in  January would be perfect. It's a long story (as many are involving family and inheritances), but we want to get this issue behind us, get the gift done, and move on. But if the total gift can't happen  until January, the amount in excess  simply reduces our lifetime gift  amount from the $11.58 million. We aren't in any danger of exceeding that amount. I don't see any concern in handling it that way, but just sanity checking that understanding in the community.

[Critter-3]

Reading the form instructions will answer your questions :   https://www.irs.gov/forms-pubs/about-form-709

[rjs]

The filing status (married filing jointly) on your income tax return does not affect how you file a gift tax return. You cannot file a joint gift tax return. Form 709 is filed by one person. If you want to split a gift, and the amount is over $30,000, you have to each file a gift tax return, but you file the two returns together. See lines 12 - 18 of Form 709, and "Lines 12–18. Split Gifts" in the IRS Instructions for Form 709. The first sentence under that heading says "Caution: A married couple may not file a
joint gift tax return." Also see "When the Consenting Spouse Must Also File a Gift Tax Return" in the instructions, and note that you do not meet the requirements for either of the exceptions in that section, since the total gift is over $30,000.

You cannot file a gift tax return with TurboTax. You might want to get help from a local tax professional for the gift tax returns.

[Hal_Al]

Q.  While I will need to claim the amount over the $30k on that form, i will not be required to pay a tax on it. Is that an accurate understanding?

A.  Yes.

"Gift Tax" is somewhat of a misnomer.  Even though a gift tax return may be required, very few people ever actually pay federal gift tax. The purpose of the gift tax return is usually only to document a reduction in the allowable estate tax exemption.
See https://turbotax.intuit.com/tax-tools/tax-tips/Tax-Planning-and-Checklists/The-Gift-Tax-Made-Simple/....