For 2026, you can gift up to $19,000 per year to any non-U.S. citizen without owing gift tax or filing a return. If that non-citizen is your spouse, the limit rises to $194,000. Anything above those amounts reduces your $15 million lifetime gift and estate tax exemption and requires you to file IRS Form 709. The recipient’s citizenship or immigration status changes the numbers only when the recipient is your spouse.
Gifts to a Non-Citizen Who Isn’t Your Spouse
The $19,000 annual exclusion for 2026 is the same limit that applies to gifts to anyone.1Internal Revenue Service. IRS Releases Tax Inflation Adjustments for Tax Year 2026 It applies per recipient, so you can give $19,000 to a non-citizen friend, another $19,000 to a non-citizen cousin, and another $19,000 to a U.S.-citizen neighbor in the same year without any tax or paperwork.
If your gift to any one person tops $19,000 in a calendar year, the excess counts against your lifetime exemption. You almost certainly won’t owe tax at that point, but you do have to file Form 709 to report the gift. A transfer to a non-citizen friend follows exactly the same rules as a transfer to a citizen friend.2Internal Revenue Service. Frequently Asked Questions on Gift Taxes
Gifts to a Non-Citizen Spouse
Between two U.S. citizens, spouses can transfer any amount to each other tax-free under the unlimited marital deduction. That unlimited deduction disappears when the receiving spouse is not a U.S. citizen. In its place, federal law provides a higher annual exclusion — $194,000 for 2026, sometimes called the super-annual exclusion.1Internal Revenue Service. IRS Releases Tax Inflation Adjustments for Tax Year 2026 The rule exists because assets given to a non-citizen spouse could later leave U.S. tax jurisdiction entirely.
A green card does not change this. The $194,000 cap applies even if your spouse is a lawful permanent resident; only full U.S. citizenship unlocks the unlimited marital deduction.3Office of the Law Revision Counsel. 26 USC 2523 – Gift to Spouse Anything above $194,000 reduces your lifetime exemption and requires Form 709. To qualify for the higher exclusion at all, the gift must be a “present interest,” meaning your spouse can use or enjoy it immediately rather than at some future date.4eCFR. 26 CFR 25.2523(i)-1 – Disallowance of Marital Deduction When Spouse Is Not a United States Citizen
Citizenship is tested at the moment of the gift. If you transfer $350,000 to your non-citizen spouse in December and your spouse naturalizes the next January, the December transfer is still capped at $194,000. The unlimited marital deduction doesn’t reach back.4eCFR. 26 CFR 25.2523(i)-1 – Disallowance of Marital Deduction When Spouse Is Not a United States Citizen
Gift Splitting Isn’t Available
Married couples where both spouses are U.S. citizens or residents can elect to split gifts, effectively doubling the annual exclusion for gifts to third parties. That election is not available when one spouse is a nonresident alien. Each spouse files their own return and is limited to their own $19,000 exclusion per recipient.5Internal Revenue Service. Frequently Asked Questions on Gift Taxes for Nonresidents Not Citizens of the United States
What Happens Above the Annual Limit
Exceeding the annual exclusion doesn’t produce an immediate tax bill. The excess chips away at your lifetime gift and estate tax exemption, which is $15,000,000 per person for 2026 following the One, Big, Beautiful Bill signed into law on July 4, 2025.6Internal Revenue Service. What’s New – Estate and Gift Tax Most people will never exhaust that exemption, but every dollar used against it during your lifetime is a dollar that won’t shelter your estate at death.
Once the $15,000,000 is gone, additional taxable gifts owe federal gift tax. Rates start at 18% and climb through several brackets to 40% on amounts above $1,000,000.7Office of the Law Revision Counsel. 26 USC 2001 – Imposition and Rate of Tax The donor pays. Recipients don’t owe gift tax on what they receive.
Filing Form 709
You file Form 709 whenever your gifts to a single person top $19,000 in a calendar year, or $194,000 for a non-citizen spouse. The return is due April 15 of the following year, and an extension of your personal income tax return typically extends Form 709 as well.8Internal Revenue Service. Filing Estate and Gift Tax Returns
The form can be filed electronically through the IRS Modernized e-File system, which also lets you authorize an electronic funds withdrawal for any balance due.9Internal Revenue Service. Instructions for Form 709 Late filing without an extension carries a penalty of 5% of any tax owed for each month overdue, up to 25%.10Internal Revenue Service. Topic No. 653, IRS Notices and Bills, Penalties and Interest Charges
You’ll need your own Social Security Number or ITIN. For each recipient, list their full legal name, address, your relationship, and a description of the property given. You do not need the recipient’s tax ID number; name and address are enough for adequate disclosure.9Internal Revenue Service. Instructions for Form 709
Valuing What You Give
Every gift on Form 709 is reported at fair market value on the date of the transfer. Cash is simple. For publicly traded stock, use the average of the day’s high and low selling prices; if no trades occurred that day, use a weighted average of the nearest trading days before and after.11eCFR. 26 CFR 25.2512-2 – Stocks and Bonds
Real estate gifts generally call for a formal appraisal by a qualified professional. Residential appraisals typically run several hundred dollars, with complex or high-value properties costing more. Keep records of your adjusted basis in the property as well — usually the original purchase price plus improvements — because that figure affects the recipient’s capital gains tax if they later sell.
If You’re Receiving a Large Gift From Abroad
The rules above cover you as the giver. If you are the U.S. person receiving a large gift from someone outside the country, a separate disclosure applies, even though recipients don’t owe gift tax. You must file Form 3520 if aggregate gifts from a nonresident alien individual or foreign estate exceed $100,000 in a year.12Internal Revenue Service. Gifts From Foreign Person It’s a disclosure form, not a tax payment.
Missing the deadline or filing incomplete information triggers a penalty of 5% of the gift’s value per month, capped at 25%.13Office of the Law Revision Counsel. 26 USC 6039F – Notice of Large Gifts Received From Foreign Persons On a $200,000 gift, that’s up to $50,000. The IRS can waive it for reasonable cause, but timely filing is the safer path whenever you receive a substantial gift from a foreign person.14Internal Revenue Service. Instructions for Form 3520