You are required to pay Gift Tax if you make significant transfers of money or property to another individual without receiving something of equal value in return. Gift Tax applies to the transfer of assets such as cash, real estate, or securities.

In 2024, you can gift up to $17,000 per recipient without incurring any Gift Tax. This amount is called the annual exclusion. If you exceed this limit, you will need to file IRS Form 709 to report the gift. However, you won’t necessarily owe taxes unless the total amount of gifts you’ve given over your lifetime exceeds the lifetime exemption limit, which is $12.92 million for 2024.

Gifts above the annual exclusion amount count toward your lifetime exemption. If you exceed this exemption, you may owe Gift Taxes. Note that the recipient of the gift generally does not owe any taxes.

Kyra Tax Filing will help you understand your Gift Taxes obligations and file the necessary forms for you.