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Do I have to file a gift tax return if I give more than the annual limit?

Answer

Yes, exceeding the annual exclusion to any single person in a year triggers a Form 709 filing, but filing rarely means paying. The excess amount is subtracted from your lifetime gift and estate tax exemption, which is in the millions per person, so no actual tax is due until you've used up that large exemption. Certain gifts never count against you and need no return: direct payments of tuition to a school or medical bills to a provider (the medical and educational exclusions), gifts to your U.S.-citizen spouse, and gifts to qualified charities. If you superfund a 529 using the 5-year election, you also file Form 709 to spread the gift. When in doubt about the threshold, file the return to keep a clean record.

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