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Returning Member
posted Feb 12, 2023 10:11:59 AM

Filing Gift Tax Form 709

Son owes around $250k.  I would like to forgive this debt as a "gift".  Do I need to forgive the max amount each year for the next x number of years to accomplish this with no taxes to either of us, or can I use the full amount now since it is below the lifetime max?  Thanks.

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2 Replies
Level 15
Feb 12, 2023 10:18:47 AM

Gift received are never reported on a tax return.

 

You can gift the full amount now assuming you are under the lifetime exclusion of $12.92 million in 2023 so no taxes would be owed.  But you will have to file the IRS form 709.

IRS Form 709 - https://www.irs.gov/forms-pubs/about-form-709

Level 15
Feb 12, 2023 10:22:19 AM

You will not incur any gift tax liability until you reach the 2023 lifetime exemption of $12.92 million.

 

If your individual gift is valued at more than $17,000 to one other person (e.g., your son), then you will have to file a gift tax return (Form 709), but there will be no tax due until you surpass the limit noted above.

 

See https://www.irs.gov/pub/irs-pdf/f709.pdf