feel free to ask me questions for clarification.
Keep in mind that the lifetime gift/estate exclusion becomes most important (if not only important) at the end of your life ... This is when it's measured (meaning, the lifetime exclusion can ONLY really be maningful at one of two points - the point in time where you hit that $5,120,000 and/or the time where you die and the amount you gave during life is compared to your estate to see if some of THAT -that FINAL gift - becomae taxable)
THe gift tax form, IRS form 709 is used to track those gifts during your life
But as I am tax non-resident alien this year, am I also subject to this lifetime exclusion?
I would complete the form (you don't need an attorney for that) just to be sure that, (regardless of whether your are considered domiciled today) the time when it becomes important (iIF you are at THAT point domiciled, a resident) here, you will have accurate numbers
THat only becomes important if you die this year
Do I still need to file IRS form 709 even when I am a tax non-resident alien ?
THey won't go back and say... you gave that gift when you were a non-resident ... so it's not part of the lifetime total
I just would like to double check that, filing a IRS form 709 won't affect my non-resident alien status
It will no ... let me get you someing on that
juuust a sec
Cool. Thanks! So IRS form 709 is the only paperwork I need to do for this gifting action, right?
That's right .. and it will eb viewed as your being compliant (and may become VERY important later)
Are the gifts more than 14,000 per person?
yes, it is much more than 14,000
then you'll be really pre-empting future headaches by filing it now
See this: The Internal Revenue Service and the courts have generally taken the position that cash gifts (for example, in the form of actual bills and coins), constitute tangible personal property. As a result, cash gifts made by a nonresident alien in the U.S. are subject to gift tax.
Got it. And do I have to file the form right after the gifting? Do I also need to include this information somewhere in my 2013 tax return next year?
NO, totally different system Gift and estate tax system is a transfer tax system, not an income tax system .. from an income tax standpoint, gifts are not even included in income
Prior rulings by the Service on the issue of whether a cash transfer, in a form other than the physical exchange of bills and coins, have not been entirely consistent. In addition, a private letter ruling binds only the IRS and the requesting taxpayer. Absent clear guidance, the safest approach is to presume that cash is tangible personal property for purposes of the gift tax rules.
I see. So I will just file IRS form 709 after I finish the gifting, which is the only thing I will do.
That is correct
Sounds good. Thanks a lot for the help!
Just found this for the instructions for 709:
Nonresidents not citizens of the UnitedStates are subject to gift and GST taxesfor gifts of tangible property situated in theUnited States. A person is considered anonresident not a citizen of the UnitedStates if he or she, at the time the gift ismade, was domiciled in a United Statespossession and acquired citizenshipsolely by reason of birth or residence inthe possession
Form 709 Instructions
Also, for the evidence of the gifting, I also need to keep the receipt/record of the stock transfer from my brokerage account, right?
Yes, would be a best practice - although they are required by to keep it for you and IRS as well
And I also plan to send my car to my friend as a gift. In this case, I also need to keep the title transfer forms/paperwork as well, right?
Absolutely - no real backup there, and more clearlyt tangible personal property
for car transfer as a gift, do I need to have a lawyer or some evaluator to verify the value of the car?
NO I would think that Edmunds or KBB would be a better value assessment than an attorney
Or I only need to write the number on the title transfer form by myself, without anyone's endorsement or evaluation?
Fair market calue is the best indicator, and writing the amount that is consodered reasonable is all that matters
So I can just refer to KBB or Edmunds and do a discount based on my car situation, and write it down by myself for the record, right?
got it. that sounds good. thanks a lot for the information:)
The links here, byt the way (forms, etc) will stay active... feel free to bookmark and come back for future reference
If this HAS helped, I would appreciate a feedback rating of 3 (OK) or better … That's the only way they will pay us here.
HOWEVER, if you need more on this, PLEASE COME BACK here, so you won't be charged for another question.
Got it. I will rate it for you now. And I will come back later if I have follow-up small questions on the same question here.
Can I help you with anything else today?
I'll be here ... and thanks