What is the Gift Tax Limit for 2025?
In 2025, the annual gift tax exclusion is expected to rise to $19,000 per recipient due to inflation adjustments. This means individuals can give up to this amount to any number of people without triggering federal gift tax. Gifts exceeding this amount will require filing IRS Form 709, but taxes are only due if you surpass your lifetime exemption, which is projected to increase to $13.99 million.
Key Points about Gift Tax Limit 2025:
- Annual Exclusion for 2025: $19,000 per recipient (projected)
- Lifetime Exemption: $13.99 million (subject to change)
- Filing Requirement: IRS Form 709 if annual gifts to any recipient exceed the exclusion limit
Gift Tax Limits and Filing Requirements for 2025
Category |
2025 Amount |
Filing Requirement |
Annual Gift Tax Exclusion |
$19,000 (projected) |
File IRS Form 709 if exceeded |
Lifetime Gift Tax Exemption |
$13.99 million |
File IRS Form 709 if exceeded |
Gift to Spouse |
Unlimited |
No filing required |
Gift to Charity |
Unlimited |
No filing required |
Gift for Medical Expenses |
Unlimited (if paid directly to institution) |
No filing required |
Gift for Educational Expenses |
Unlimited (if paid directly to institution) |
No filing required |
Frequently Asked Questions:
1. Who pays the gift tax?
The donor (the person giving the gift) is responsible for paying any applicable gift taxes, not the recipient.
2. What happens if I exceed the gift tax limit in 2025?
You’ll need to file IRS Form 709, but you won’t owe taxes unless your total gifts over time exceed the lifetime exemption of $13.99 million.
3. Are there exceptions to the gift tax?
Yes, gifts to spouses, charitable donations, and direct payments to educational or medical institutions are generally excluded from gift tax.
4. What gifts are excluded from the gift tax?
Gifts to a spouse, donations to charities, and direct payments for medical or educational expenses are not subject to gift tax and do not count toward the annual exclusion limit.
5. Do I need to pay taxes on gifts under $19,000 in 2025?
No, gifts under the projected $19,000 limit for 2025 are not subject to gift tax. You won’t need to file IRS Form 709 for these gifts.
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