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 a nationwide tax that applies to the transfer of property from one person to another when the transfer is made without receiving something of equal value in return. This tax is governed by federal law, not state law, so it applies uniformly across all states, including Iowa (IA). The tax encompasses any type of property, including money, real estate, or other assets. If an individual in Iowa gives property or money to someone else without getting something of equal value in return, or sells something for less than its market value, or extends a loan without interest or at a below-market interest rate, it may be considered a gift for tax purposes. The donor is typically responsible for paying the gift tax and must file IRS Form 709 if the gift exceeds the annual exclusion limit set by the IRS. It's important to note that there are certain exclusions and exemptions to the gift tax, such as gifts to spouses, gifts to charities, and gifts that do not exceed the annual exclusion amount. For specific guidance and the most current information regarding the gift tax, including the annual exclusion amount and how to file Form 709, individuals should consult the IRS or an attorney with expertise in tax law.