The gift tax is a tax on the transfer of property by one individual to another while receiving nothing, or less than full value, in return. The tax applies whether or not the donor intends the transfer to be a gift.
The gift tax applies to the transfer by gift of any type of property. You make a gift if you give property (including money), or the use of or income from property, without expecting to receive something of at least equal value in return. If you sell something at less than its full value or if you make an interest-free or reduced-interest loan, you may be making a gift.
For additional information, review Form 709 and its instructions and Form 709-NA, United States Gift (and Generation-Skipping Transfer) Tax Return of Nonresident Not a Citizen of the United States PDF and Instructions for Form 709-NA, United State Gift (and Generation Skipping Transfer) Tax Return of nonresident not a citizen of the United States PDF.
To determine which instructions to review and return to file to report the transfer(s), you must first determine your citizenship or resident status.
- Was the donor (at the time of the gift) or the decedent (at the date of death) a U.S. citizen? If yes, review instructions for Form 709 (for donor) or Form 706 (for decedent), as applicable.
- If not a U.S. citizen, was the donor (at the time of the gift) or the decedent (at the date of death) a U.S. resident?
- Note that “resident” for tax purposes is different than resident for income tax purposes, which means a person may be a U.S. resident for income tax purposes yet be considered a nonresident for gift tax purposes.
- For gift tax purposes, “residency” is effectively your domicile (see Treas. Reg. §§ 20.0-1(b) and 25.2501-1(b)).
- A person acquires a domicile in a place by living there, even for a brief period of time, with no definite present intention of moving therefrom.
- For estate and gift tax purposes, holding a “green card” is not conclusive evidence of an intent to be domiciled in the U.S.
- If the donor (at the time of the gift) or the decedent (at the date of death) was a resident of the U.S., review the instructions for Form 709 (for donor) or Form 706 (for decedent), as applicable.
- If the donor was neither a citizen nor resident at the time of the gift or at the date of death,
- Did the donor make gifts of U.S.-situs real or tangible property? If yes, review instructions for Form 709-NA.
- If the decedent was neither a citizen nor resident at the date of death, review the instructions for Form 706-NA.
The table below is intended to be a summary of the above information. To determine whether a return is required to be filed, review the noted form’s instructions.
| Status | Form 709, Gift tax return | Form 709-NA, Gift tax return |
|---|---|---|
| United States Citizen or United States Resident | Yes | No |
| Non-resident United States Citizen | Yes | No |
| United States Resident (non-Citizen) | Yes | No |
| Nonresident not a United States Citizen (NRNC) | No. (However, if you also made gifts as an NRNC and as a U.S. citizen in the same year, file Form 709.) | Yes, for gifts of real and tangible property situated in the U.S. |
| Green Card Holder (Legal Resident of the United States) (not conclusive of being domiciled in the U.S.) | Yes, if domiciled in the U.S. | Yes, if not domiciled in the U.S. and gift was of U.S.-situs real or tangible property |
* Under certain circumstances, a donor who is a citizen of the U.S. and a resident of a possession of the U.S. shall be considered a “nonresident not a citizen of the United States.” Review the instructions for Form 709-NA