Instructions For Form 709 - 2009 (Page 6 of 12) in pdf

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In 2010, D gives a gift of $20,000 cash

In column F, enter the full value of the

gift on Form 709 because you gave the

to her niece and no other gifts. On her

gift (including those made by your

present interest to a donee other than

2010 Form 709, D reports in Part 1 of

spouse, if applicable). If you have chosen

your spouse, then you should enter the

Schedule A the $20,000 gift to her niece

to split gifts, that one-half portion of the

entire gift, including the future interest

and a $13,000 gift to her son (the one-fifth

gift is entered in column G.

given to your spouse, on Schedule A. You

portion of the 2009 gift that is treated as

should use the rules under Gifts Subject

Gifts to Donees Other Than

made in 2010). In column E of Part 1

to Both Gift and GST Taxes below to

Your Spouse

(Schedule A), D lists “2010” as the date of

determine whether to enter the gift on

the gift.

You must always enter all gifts of future

Schedule A, Part 1, Part 2, or Part 3.

interests that you made during the

Spouses who are not U.S. citizens. If

D makes no gifts in 2011, 2012, or

calendar year regardless of their value.

your spouse is not a U.S. citizen and you

2013. She is not required to file Form 709

gave him or her a gift of a future interest,

in any of those years to report the

No gift splitting. If the total gifts of

you must report on Schedule A all gifts to

one-fifth portion of the QTP gift, because

present interests to any donee are more

she is not otherwise required to file Form

your spouse for the year. If all gifts to your

than $13,000 in the calendar year, then

spouse were present interests, do not

709.

you must enter all such gifts that you

report on Schedule A any gifts to your

made during the year to or on behalf of

You make the election by checking the

spouse if the total of such gifts for the

that donee, including those gifts that will

box on line B at the top of Schedule A.

year does not exceed $133,000 and all

be excluded under the annual exclusion.

The election must be made for the

gifts in excess of $13,000 would qualify

If the total is $13,000 or less, you need

calendar year in which the contribution is

for a marital deduction if your spouse

not enter on Schedule A any gifts (except

made. Also attach an explanation that

were a U.S. citizen (see the instructions

gifts of future interests) that you made to

includes the following:

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for Schedule A, Part 4, line 4, on page 9).

that donee. Enter these gifts in the top

The total amount contributed per

If the gifts exceed $133,000, you must

half of Part 1, 2, or 3, as applicable.

individual beneficiary,

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report all of the gifts even though some

The amount for which the election is

Gift splitting elected. Enter on

may be excluded.

being made, and

Schedule A the entire value of every gift

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The name of the individual for whom

you made during the calendar year while

Gifts Subject to Both Gift

the contribution was made.

you were married, even if the gift’s value

and GST Taxes

will be less than $13,000 after it is split in

If you are electing gift splitting, apply

Column G of Part 1, 2, or 3 of

the gift-splitting rules before applying

Definitions

Schedule A.

these rules. Each spouse would then

decide individually whether to make this

Gifts made by spouse. If you elected

Direct skip. The GST tax you must

QTP election.

gift splitting and your spouse made gifts,

report on Form 709 is that imposed only

list those gifts in the space below “Gifts

on inter vivos direct skips. An “inter vivos

Contributions to QTPs do not

made by spouse” in Part 1, 2, or 3. Report

direct skip” is a transfer that is:

qualify for the education exclusion.

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these gifts in the same way you report

Subject to the gift tax,

CAUTION

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gifts you made.

Of an interest in property, and

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How To Complete Parts 1, 2,

Made to a skip person.

Gifts to Your Spouse

and 3

All three requirements must be met

Except for the gifts described below, you

before the gift is subject to the GST tax.

After you determine which gifts you made

do not need to enter any of your gifts to

are subject to the gift tax and therefore

A gift is “subject to the gift tax” if you

your spouse on Schedule A.

should be listed on Schedule A, you must

are required to list it on Schedule A of

Terminable interest. Terminable

divide these gifts between:

Form 709. However, if you make a

interests are defined in the instructions to

nontaxable gift (which is a direct skip) to a

1. Part 1 — those subject only to the

Part 4, line 4 on page 9. If all the

trust for the benefit of an individual, this

gift tax (gifts made to nonskip

terminable interests you gave to your

transfer is subject to the GST tax unless:

persons — see Part 1 — Gifts Subject Only

spouse qualify as life estates with power

to Gift Tax on page 8),

1. During the lifetime of the

of appointment (defined under Life estate

2. Part 2 — those subject to both the

beneficiary, no corpus or income may be

with power of appointment on page 9),

gift and GST taxes (gifts made to skip

distributed to anyone other than the

you do not need to enter any of them on

persons — see Gifts Subject to Both Gift

beneficiary and

Schedule A.

and GST Taxes below and Part 2 — Direct

2. If the beneficiary dies before the

However, if you gave your spouse any

Skips on page 9), and

termination of the trust, the assets of the

terminable interest that does not qualify

3. Part 3 — those subject only to the

trust will be included in the gross estate of

as a life estate with power of

gift tax at this time but which could later

the beneficiary.

appointment, you must report on

be subject to GST tax (gifts that are

Schedule A all gifts of terminable interests

Note. If the property transferred in the

indirect skips, see Part 3 — Indirect Skips

you made to your spouse during the year.

direct skip would have been includible in

on page 9).

the donor’s estate if the donor had died

Charitable remainder trusts. If you

immediately after the transfer, see

If you need more space, attach a

make a gift to a charitable remainder trust

Transfers Subject to an Estate Tax

separate sheet using the same format as

and your spouse is the only noncharitable

Inclusion Period (ETIP) on page 3.

Schedule A.

beneficiary (other than yourself), the

interest you gave to your spouse is not

To determine if a gift “is of an interest

Use the following guidelines when

considered a terminable interest and,

in property” and “is made to a skip

TIP

entering gifts on Schedule A:

therefore, should not be shown on

person,” you must first determine if the

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Schedule A. For definitions and rules

donee is a “natural person” or a “trust” as

Enter a gift only once — in Part 1, Part

concerning these trusts, see section

defined below.

2, or Part 3;

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2056(b)(8)(B) and Regulations section

Do not enter any gift or part of a gift

Trust. For purposes of the GST tax, trust

20.2055-2.

that qualified for the political organization,

includes not only an explicit trust, but also

educational, or medical exclusion;

Future interest. Generally, you should

any other arrangement (other than an

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Enter gifts under “Gifts made by

not report a gift of a future interest to your

estate) that although not explicitly a trust,

spouse” only if you have chosen to split

spouse unless the future interest is also a

has substantially the same effect as a

gifts with your spouse and your spouse is

terminable interest that is required to be

trust. For example, trust includes life

required to file a Form 709 (see Part

reported as described above. However, if

estates with remainders, terms for years,

1 — General Information, Lines 12 – 18.

you gave a gift of a future interest to your

and insurance and annuity contracts. A

Split Gifts on page 5); and

spouse and you are required to report the

transfer of property that is conditional on

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Instructions For Form 709 - 2009 Page 6

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