The federal gift tax is a tax on the transfer of property from one individual (the donor) to another (the donee) when the donor receives nothing—or less than full value—in return. The tax applies whether the donor intends the transfer to be a gift or not.

The gift tax applies to the transfer of a 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, see Internal Revenue Service (IRS) Form 709 and its instructions.

The federal gift tax is applicable to all states in the United States, including Louisiana (LA). It is imposed on the transfer of property by one person (the donor) to another (the donee) without receiving full value in return. This tax is required regardless of the donor's intention for the transfer to be a gift. The tax encompasses all types of property transfers, whether it's money, real estate, or other forms of property. If a donor sells something for less than its market value or extends a loan without interest or at a reduced interest rate, it may also be considered a gift. The donor is typically responsible for paying the gift tax and must file IRS Form 709 if any gifts exceed the annual exclusion limit. For 2023, the annual gift tax exclusion is $17,000 per recipient. Gifts that exceed this amount may require the filing of Form 709 and potentially paying the gift tax, although there are lifetime exemptions and other strategies that can be employed to minimize or avoid the tax. It's important to consult with an attorney or a tax advisor for personalized advice, especially when dealing with significant gifts or complex financial situations.