Gift Tax Return Superfunding 529 Plan

[hmosbergea]

Is it necessary to file Form 709 each year for the next 5 years when electing Section 529(c)(2)(B) for a gift of $80,000 in 2021 to a grandchild for superfunding a 529 plan?

[TaxGuyBill]

$80,000 for 2021? 

The limit is $15,000 for 2021.  As such, if that election was made, the $80,000 is spread out "ratably" over the 5 years, so you would have $16,000 per year.

So there definitely would need to be a Gift Tax returns for 2021.

As for the other years, I don't think so (the limit increases to $16,000 for 2022), but I'm not particularly fluent on Gift Tax so perhaps somebody has a more definitive answer.  On the other hand, if the giver gave anything else to the recipient in future years (birthday present, etc.), that would go over the limit and a Gift Tax return would be required.

Will the giver ever potentially be subject to Gift or Estate tax?  If not, adding it all onto 2021 would be easiest.

[sjrcpa · Accepted solution]

If the "carryover" is the only gift in the next 4 years, no gift tax return required in those years.

If there are other gifts then include this on the subsequent years gift tax returns.