If you give over $11,000 to anyone, in a given year, you’ll have to file Form 709, the federal gift tax return. (That includes contributions to a 529 college savings plan.) Here are some guidelines:
There are no joint gift tax returns. Each spouse must look at his or her own gifting history to determine the filing requirements and how much, if anything, to report.
Spouses can agree to split all gifts made during the year. You will pick up one-half of your spouse’s gifts, and vice-versa. There is a spot on Form 709 where the consenting spouse must sign.
Splitting gifts is usually a good idea when one spouse has exceeded the annual exclusion limit and the other has not. By splitting, both spouses may succeed in staying below the $11,000 annual exclusion limit, in which case only one Form 709 is required.
A five-year wrap is available for 529 plans. Anyone making $11,000-$55,000 in 529 contributions in one year for any beneficiary can spread those contributions over a five-year period for gift-tax purposes. This permits 529 contributors to make higher upfront contributions while often avoiding gift tax problems. You must file Form 709 in order to make the election but you do not have to file Form 709 in subsequent years unless your gifts, including the pro-rata 529 contribution, exceed your $11,000 annual exclusions.
