Gift

[MGC94]

My client gifted $190,000 to X

$20,000 to Y

$30,000 to Z

$20,000 to XX

and $20,000 to YY. 

How should I report this? It is not a gift to charity on Schedule A. 

I do not see form 709 on ProSeries where do I enter green box. 

All gifts were to her children except the $190,000 given to friend to buy her house.

Please help and any additional advice for it would be greatly appreciated. Thank you  

[Just-Lisa-Now-]

You need to install the 709 module.  Its a completely separate return.  Gifts to private parties don't go on the 1040 anywhere.

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[qbteachmt]

"It is not a gift to charity on Schedule A."

Because it's not going to be a deduction, either.

"All gifts were to her children except the $190,000 given to friend to buy her house."

It would be great if you can show there are spouses, and that the amounts don't exceed the gift limits per person, then perhaps her only problem will be the friend's gift. Did she know if she will be paying taxes on that gift she gave to her friend? She might need time to prepare for that expense.

[MGC94]

which form would I use for family/friend gift. There is 709 page 1 - 5 or I can do all forms. When I put in $190,000 I do not show it saying they owe anything. Thanks for the help 

[qbteachmt]

If you are considering part of their estate exemption, it isn't taxed now, but it is tracked. It's all part of "wealth management" really.

I like this source for articles:

https://www.investopedia.com/terms/a/annual-exclusion.asp

[qbteachmt]

Here's a TurboTax article:

https://turbotax.intuit.com/tax-tips/estates/the-gift-tax-made-simple/L5tGWVC8N

[Just-Lisa-Now-]

You wont see a balance due on the 709 when you report the giving of the gift.

[MGC94]

I thought you said she would be paying taxes on the gift she paid her friend

[qbteachmt]

"I thought you said she would be paying taxes on the gift she paid her friend"

I explained how some of the giving might be characterized so that it falls under the annual limit. As for the Estate or Lifetime limit, there are no details to be able to tell you that, but you would need the person to be prepared, if that is an issue. In other words, did the person get any guidance on this, or have they already put themselves in a pickle? Because you would want to inform the person, if they are impacted.

[MGC94]

I am not sure how to determine if they are impacted. I am hoping they are not impacted. They do have money for whatever would be owed. What part of the 709 do I do and then do I put that on the personal return?   

[sjrcpa]

The 709 is completely separate from the 1040. 709 info does not go anywhere on the 1040.

Each person gets a lifetime exemption from estate and gift tax. If your client has not used her lifetime exemption then no gift tax is due on this year's 709.