2021 Gift Tax Exclusion
For 2021, the Gift Tax Exclusion figures are $15,000 (Annual exclusion per recipient) and $159,000 (Annual exclusion for a gift to a noncitizen spouse).
Effective 2021-01-01Source: Rev. Proc. 2020-45 (IRS)Verified 2026-09-03
Compared with 2020
| Item | 2020 | 2021 | Change |
|---|---|---|---|
| Annual exclusion per recipient | $15,000 | $15,000 | +$0 (+0.0%) |
| Annual exclusion for a gift to a noncitizen spouse | $157,000 | $159,000 | +$2,000 (+1.3%) |
Who it applies to
Taxpayers making gifts to individuals during the 2021 calendar year
What changed this year, and why
The annual gift exclusion remains $15,000 per recipient for calendar year 2021, the same as in 2020.
Common questions
- Does the annual exclusion apply to all gifts?
- For 2021, you may give up to $15,000 to each recipient without the gift counting toward your lifetime gift and estate tax exemption. Gifts to your spouse who is not a U.S. citizen have a separate, higher exclusion. Gifts of future interests in property do not qualify for the annual exclusion.
When a gift needs no return at all
A donor does not have to file Form 709 for 2021 only when every gift made during the year satisfies three conditions at the same time. First, the donor must not have made any gifts to a spouse; gifts to a spouse normally require a return even when they are deductible. Second, no single donee may have received gifts totaling more than $15,000; once that amount is exceeded for any one person, a return is required for that gift. Third, every gift given during the year must have been a present interest, meaning the recipient had an immediate right to use or enjoy the property. If any one of these three tests fails, the donor must file a gift tax return, although filing does not necessarily mean that any tax will be owed because the $15,000 annual exclusion and other provisions may eliminate the liability. A donor who gave only deductible charitable gifts generally also does not need to file, provided the entire interest in the property went to qualifying charities.
Who does not need to file. If you meet all of the following requirements, you are not required to file Form 709. • You made no gifts during the year to your spouse. • You did not give more than $15,000 to any one donee. • All the gifts you made were of present interests.
2021 Instructions for Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return (IRS)
The gifts the exclusion does not cover
A future interest exists whenever the donee's right to use, possess, or enjoy the property or its income is delayed until some later date; typical examples include remainders, reversions, and similar interests that do not take effect immediately. Because the annual exclusion is unavailable, the entire value of the transfer must be reported on the return, and the amount that would otherwise have been sheltered instead counts against the donor's lifetime gift and estate tax exemption. A present interest, by contrast, is one where the donee has an immediate right to the use, possession, and enjoyment of the property or its income, and only that kind of gift qualifies for the exclusion. Contributions to a qualified tuition program (QTP) on behalf of a designated beneficiary are treated as present interests for this purpose, as are certain gifts to minors that meet specific conditions.
Certain gifts, called future interests, are not subject to the $15,000 annual exclusion and you must file Form 709 even if the gift was under $15,000.
2021 Instructions for Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return (IRS)
Who actually owes the gift tax
The donor is responsible for paying the gift tax. The obligation to file Form 709 and to remit any gift tax due rests first on the person who made the transfer; the donee has no primary liability under normal circumstances. The IRS will, however, look to the recipient if the donor fails to pay, so a person who receives a large gift should be aware that an unpaid tax on that transfer could become their own obligation. If a donor dies before filing a return or paying the tax due, the donor's executor becomes responsible for filing the return on behalf of the estate. Because the donee's exposure arises only after the donor defaults, recipients of significant gifts often want confirmation that the donor has filed and paid, particularly when the gifts are large enough to generate a real tax liability rather than merely a reporting requirement.
The donor is responsible for paying the gift tax. However, if the donor does not pay the tax, the person receiving the gift may have to pay the tax.
2021 Instructions for Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return (IRS)
Splitting a gift with your spouse
A married couple may not file a joint gift tax return. When gifts are split, each spouse is treated as having made half of every gift the other made during the year, so both must file their own Form 709 to report the split and to indicate consent. Both spouses must consent, and the election, once made for the year, applies to all gifts made by either spouse during that calendar year; partial splitting is not permitted.
If you and your spouse both consent, all gifts (including gifts of property held with your spouse as joint tenants or tenants by the entirety) either of you make to third parties during the calendar year will be considered as made one-half by each of you if all of the following apply. • You and your spouse were married to one another at the time of the gift. • If divorced or widowed after the gift, you did not remarry during the rest of the calendar year. • Neither of you was a nonresident not a citizen of the United States at the time of the gift. • You did not give your spouse a general power of appointment over the property interest transferred.
2021 Instructions for Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return (IRS)
When the return is due
Form 709 is an annual return. Generally, you must file Form 709 no earlier than January 1, but not later than April 15, of the year after the gift was made. For a gift made in 2021, therefore, the regular due date was April 15, 2022, unless that date was displaced by a weekend or holiday. An automatic extension of time to file the taxpayer's federal income tax return also automatically extends the due date of the gift tax return by the same period, typically to October 17, 2022 in the case of 2021 returns. Neither form of extension extends the time to pay any gift or GST tax owed; a separate request must be made for a payment extension. If the donor died during 2021, the executor must file the 2021 Form 709 no later than the earlier of the due date (with extensions) for the donor's estate tax return or April 15, 2022 (or the extended gift tax due date).
Form 709 is an annual return. Generally, you must file Form 709 no earlier than January 1, but not later than April 15, of the year after the gift was made. However, in instances when April 15 falls on a Saturday, Sunday, or legal holiday, Form 709 will be due on the next business day.
2021 Instructions for Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return (IRS)
Room you do not use for one person this year is simply gone
Under federal gift tax rules for 2021, the $15,000 annual exclusion applies separately to each person who receives a gift from you during the calendar year. If you give less than that amount to someone, or give nothing to someone else, the leftover amount cannot be shifted to a different recipient or saved for use in a later year. The exclusion is calculated on a per-donee, per-calendar-year basis and expires at the end of the year if it is not fully used for that particular donee.
The first $15,000 of gifts of present interest to each donee during the calendar year is subtracted from total gifts in figuring the amount of taxable gifts.
2021 Instructions for Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return (IRS)
Understating what a gift was worth carries its own penalty
Federal gift tax law for 2021 imposes penalties when a donor reports a gift at a value significantly below its true worth, and the understatement causes an underpayment of tax. A substantial valuation understatement occurs when the value listed on Form 709 is 65% or less of the property's actual value. This penalty is separate from those for willful failure to file or willful attempt to evade tax, and it applies specifically to the difference between what was reported and what the property was actually worth at the time of the gift. Understating what a gift was worth carries its own penalty, so donors must report values that reflect the true market value of the property transferred.
and valuation understatements that cause an underpayment of the tax. A substantial valuation understatement occurs when the reported value of property entered on Form 709 is 65% or less of the actual value of the property.
2021 Instructions for Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return (IRS)
Giving more than the exclusion does not automatically mean tax is owed
Giving more than the annual exclusion to one recipient in a year does not automatically mean gift tax is owed. Every dollar of taxable gifts above the annual exclusion is applied against a separate, much larger lifetime allowance - the basic exclusion amount under IRC section 2010(c), the same allowance a person's estate draws on at death. Tax is due only once a donor's cumulative taxable gifts exceed that allowance. The IRS's instructions for Form 709 state it directly: for 2021, the donor's basic exclusion amount is $11,700,000. Because that amount changes from year to year and can also be changed by legislation, see this site's estate tax exemption page for how the current year's basic exclusion amount is set and how it interacts with lifetime gifts.
On line 1, enter the donor's basic exclusion amount; for 2021, this amount is $11,700,000.
2021 Instructions for Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return (IRS)
How each figure was verified
Each number below was read from a stored copy of the document named beside it, and checked to occur word for word in the quoted sentence. The digest is of that stored text.
Rev. Proc. 2020-45 (IRS)
- Annual exclusion per recipient
.43 Annual Exclusion for Gifts. (1) For calendar year 2021, the first $15,000 of gifts to any person (other than gifts of future interests in property) are not included in the total amount of taxable gifts under § 2503 made during that year.
- Annual exclusion for a gift to a noncitizen spouse
(2) For calendar year 2021, the first $159,000 of gifts to a spouse who is not a citizen of the United States (other than gifts of future interests in property) are not included in the total amount of taxable gifts under §§ 2503 and 2523(i)(2) made during that year.