What types of gifts are taxable?

Gifts given to a non-citizen spouse, or non-spouse, that exceed the annual Internal Revenue Service tax exclusion amount are taxable as of 2015. Monetary gifts subject to taxation include cash, jewelry, cars and real estate. Information about gift taxes can be found in IRS publication 950.

Another type of gifting that is taxable are gifts of future interests. Future interest refers to giving someone a gift they can only enjoy in the future. Gifting property to a spouse or children upon the death of the gift giver is an example of this type of gifting. There is no protection from taxation under gift of future interest.

Many gifts are not subject to IRS taxation, including gifts to spouses, charitable gift giving and gifts made to political organizations. Note that gifts given to spouses who are not U.S. citizens are excluded from taxation up to a certain monetary amount set by the U.S. government. Other types of non-taxable gifts are medical bills and college tuition, which is paid directly to the institution. Gifting plays no role in federal income taxes, and most gifts cannot be counted as an income tax deduction. The exception is gifts to charities. Likewise, recipients of gifts are not required to pay income taxes, or gift taxes, on the value of the gift.