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.
In Oklahoma, as in all states, the federal gift tax applies to transfers of property where the donor does not receive full value in return. This tax is imposed by the federal government, not the state, and it encompasses any type of property transfer, whether it's money, real estate, or other valuable items. If an individual gives away property, lends money without interest or at a reduced interest rate, or sells something for less than its full value, it may be considered a gift for tax purposes. The donor is typically responsible for paying the gift tax. Each year, there is an annual exclusion amount for gifts to any one person that is not subject to the tax. Beyond this exclusion, the donor must file IRS Form 709 to report the gift. The lifetime gift tax exemption also applies, which allows individuals to give away a certain amount over their lifetime before incurring a tax. It's important to consult with an attorney or tax advisor to understand the implications of gift taxes on any property transfers.