The humble gift tax return is among the easiest tax document to forget, but it’s also one of the most important to get right. After all, the return is what the IRS uses to assess any possible gift tax. Even if you don’t actually “owe” any gift tax, you still must file the return.
Why?
Gift tax returns that raise red flags or don’t get filed in the first place can be audited just like any tax return. No audit is a good audit.
So, if this is new information to you and you are not ready to file your Form 709, then you can get an extension by filing a Form 8892. Perhaps you need more time to get everything properly documented.
The original Forbes article also has some pointers when it comes to extensions. However, any gift tax must be paid by April 15, if any is owed. Otherwise, you will be hit with interest and potential penalties.
This is a hot topic this year, since 2012 was such a big year for gifting.
For more information, please visit my estate planning website.
