- 1). Download IRS Form 709, the United States Gift (and Generation-Skipping Transfer) Tax Return. This is downloadable from the IRS website. For ease of use, you may complete the form online and save data typed directly on the form. Also download IRS Form 709 Instructions, which can be helpful when deciding how best to complete lines on the form.
- 2). Complete Schedule A before filling in the first side of Form 709. Direct gifts to children or nonrelatives are listed in Part 1. If gifts are being split with a spouse, also complete the second half of Part 1. In Part 2, list gifts that skip over a child and are made directly to grandchildren or other second-generation relatives. Gifts made to a trust with beneficiaries who are grandchildren or other second-or-beyond generations are listed in Part 3. For a complete description of the technical definition of IRS generation-skipping rules, refer to Form 709 Instructions. Complete Part 4 to determine the taxable amount of the deceased's gifts.
- 3). Complete Schedules B and C. List each gift made by the decedent to beneficiaries in Schedule B. In column A, write the calendar year of the gift. For gifts made after 1970 and before 1982 you must also list the calendar quarter the gift was made. In column B, list the IRS office listed on the return for the prior year. Write the amount of unified credit used in column C and exemptions in column D. Finally, write the taxable amount of past gifts in column E. Complete the math required on line 1-3 to finish Schedule B. Fill in Schedule C if any gifts were listed on Schedule A, Parts 2 or 3.
- 4). Complete Part I. If the donor died during the current tax year, fill in line 8. If you extended your time to file the return, complete line 9. List the total number of donees on line 10. If the deceased filed Form 709 in prior years, complete line 11. If a spouse survives and wishes to claim half the gift as being from her, complete lines 12 through 17 and have the spouse sign line 18.
- 5). Complete Part II and sign the form. Part II is the tax computation portion of the form. Complete lines 1-20 to determine if the decedent owes additional taxes or if the estate qualifies for a refund. If you are the personal representative of the estate, sign the form. If you are the spouse of the decedent and no personal representative has been appointed, sign the form for the decedent and write "filing as surviving spouse" on the signature line.
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