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Neither of you was a nonresident alien

However, only one spouse must file a

beginning in 2006. You can make this

at the time of the gift; and

return if all the requirements of either of

election for as many separate people as

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You did not give your spouse a general

the exceptions below are met. In the

you made QTP contributions.

power of appointment over the property

exceptions below, “gifts” means gifts (or

You can only apply the election to a

interest transferred.

parts of gifts) that do not qualify for the

maximum of $60,000. You must report in

political organization, educational, or

2006 all of your QTP contributions for any

If you transferred property partly to

medical exclusions.

single person that exceed $60,000 (in

your spouse and partly to third parties,

Exception 1. During the calendar year:

addition to any other gifts you made to

you can only split the gifts if the interest

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Only one spouse made any gifts,

that person).

transferred to the third parties is

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The total value of these gifts to each

ascertainable at the time of the gift.

For each of the 5 years, you report in

third-party donee does not exceed

Part 1 of Schedule A,

(20%) of the

The consent is effective for the entire

$24,000, and

amount for which you made the election.

calendar year; therefore, all gifts made by

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All of the gifts were of present interests.

In column E of Part 1 (Schedule A), list

both you and your spouse to third parties

Exception 2. During the calendar year:

the date of the gift as the calendar year

during the calendar year (while you were

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Only one spouse (the donor spouse)

for which you are deemed to have made

married) must be split.

made gifts of more than $12,000 but not

the gift (that is, the year of the current

If the consent is effective, the liability

more than $24,000 to any third-party

Form 709 you are filing). Do not list the

for the entire gift tax of each spouse is

donee,

actual year of contribution for subsequent

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joint and several.

The only gifts made by the other

years.

spouse (the consenting spouse) were

If you meet these requirements and

However, if in any of the last 4 years of

gifts of not more than $12,000 to

want your gifts to be considered made

the election, you did not make any other

third-party donees other than those to

one-half by you and one-half by your

gifts that would require you to file a Form

whom the donor spouse made gifts, and

spouse, check the “Yes” box on line 12,

709, you do not need to file Form 709 to

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All of the gifts by both spouses were of

page 1; complete lines 13 through 17;

report that year’s portion of the election

present interests.

and have your spouse sign the consent

amount.

on line 18.

If either of the above exceptions is

Example. In 2006, D contributed

met, only the donor spouse must file a

If you are not married or do not wish to

$85,000 to a QTP for the benefit of her

return and the consenting spouse

split gifts, skip to Schedule A.

son. D elects to treat $60,000 of this

signifies consent on that return.

contribution as having been made ratably

Line 15

Specific instructions for Part 2 — Tax

over a 5-year period. Accordingly, for

If you were married to one another for all

Computation are continued under Part

2006, D reports the following:

of 2006, check the “Yes” box and skip to

2 — Tax Computation (Page 1 of Form

line 17. If you were married for only part

709) on page 11. Because you must

$25,000

(the amount of the contribution

of the year, check the “No” box and go to

complete Schedules A, B, and C to fill out

that exceeded $60,000)

line 16. If you were divorced or widowed

Part 2, you will find instructions for these

+ $12,000

(the

portion from the election)

after you made the gift, you cannot elect

schedules below.

$37,000

the total gift to her son listed in

to split gifts if you remarried before the

Part 1 of Schedule A for 2006.

end of 2006.

Schedule A. Computation

In 2007, D gives a gift of $20,000 cash

Line 16

to her niece and no other gifts. On her

of Taxable Gifts

Check the box that explains the change in

2007 Form 709, D reports in Part 1 of

your marital status during the year and

Do not enter on Schedule A any gift or

Schedule A, the $20,000 gift to her niece

give the date you were married, divorced,

part of a gift that qualifies for the political

and a $12,000 gift to her son (the one-fifth

or widowed, or the date the donor spouse

organization, educational, or medical

portion of the 2006 gift that is treated as

died.

exclusions. In the instructions below,

made in 2007). In column E of Part 1

“gifts” means gifts (or parts of gifts) that

(Schedule A), D lists “2007” as the date of

Consent of Spouse

do not qualify for the political

the gift.

Your spouse must sign the consent for

organization, educational, or medical

D makes no gifts in 2008, 2009, or

your gift-splitting election to be valid. The

exclusions.

2010. She is not required to file Form 709

consent may generally be signed at any

Line A. Valuation Discounts

in any of those years to report the

time after the end of the calendar year.

portion of the QTP gift, because she is

However, there are two exceptions.

If the value of any gift you report in either

not otherwise required to file Form 709.

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

1. The consent may not be signed

reflects a discount for lack of

You make the election by checking the

after April 16 following the end of the year

marketability, a minority interest, a

box on line B at the top of Schedule A.

in which the gift was made. But, if neither

fractional interest in real estate, blockage,

The election must be made for the

you nor your spouse has filed a gift tax

market absorption, or for any other

calendar year in which the contribution is

return for the year on or before that date,

reason, answer “Yes” to the question at

made. Also attach an explanation that

the consent must be made on the first gift

the top of Schedule A. Also, attach an

includes the following:

tax return for the year filed by either of

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explanation giving the factual basis for the

The total amount contributed per

you.

claimed discounts and the amount of the

individual beneficiary,

2. The consent may not be signed

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discounts taken.

The amount for which the election is

after a notice of deficiency for the gift tax

being made, and

for the year has been sent to either you or

Line B. Qualified Tuition

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The name of the individual for whom

your spouse.

Programs (529 Plans or

the contribution was made.

Programs)

The executor for a deceased spouse

If you are electing gift splitting, apply

or the guardian for a legally incompetent

If in 2006, you contributed more than

the gift splitting rules before applying

spouse may sign the consent.

$12,000 to a QTP on behalf of any one

these rules. Each spouse would then

person, you may elect to treat up to

decide individually whether to make this

When the Consenting Spouse Must

$60,000 of the contribution for that person

QTP election.

Also File a Gift Tax Return

as if you had made it ratably over a

Contributions to QTPs do not

In general, if you and your spouse elect

5-year period. The election allows you to

qualify for the education exclusion.

gift splitting, then both spouses must file

apply the annual exclusion to a portion of

CAUTION

his or her own, individual, gift tax return.

the contribution in each of the 5 years,

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Instructions For Form 709 - United States Gift (And Generation-Skipping Transfer) Tax Return - 2006 Page 5

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