Federal gift tax


Federal gift tax

A federal tax imposed on assets conveyed as gifts to individuals.

Gift Tax

A tax that the federal government levies on givers of gifts in excess of a certain value. If the value of a gift is over a certain amount, which varies from year to year but is always over $10,000, the government assesses the gift tax. The tax applies even if the recipient pays for the gift, so long as he/she does not pay for the full value. Generally speaking, payments for medical, educational, and political purposes are exempt from the gift tax, as are gifts to one's spouse.