Annual Gift Tax Exclusion for 2027

$20,000 to each person you choose, with no limit on how many people — the amount in Rev. Proc. 2026-35 §3.46(1). Give $20,000 apiece to 4 different people and you have moved $80,000 without touching a form or a lifetime allowance. A married couple who agree to split gifts can double that to $40,000 each, or $160,000 across 4 recipients.

Yes — to $20,000, the first increase since it reached $19,000 in 2025. Section 2503(b)(2) indexes a $10,000 base and then rounds DOWN to the next whole $1,000, so the published amount only moves when the underlying index clears a full thousand. In 2026 the unrounded amount was about $19,498, so it rounded down to $19,000 again; a year of chained CPI-U growth to August 2026 carried it past the next step.

Almost certainly not, though you do have to report it. Anything above the per-recipient allowance is subtracted from your lifetime exclusion, $15,480,000 for 2027, and no tax is actually due until that entire lifetime amount has been consumed. What changes is the paperwork: you must file Form 709 for the year of the gift so the IRS can track how much of your lifetime allowance you have used. Very few people ever pay gift tax; many more need to file.

They stack in a specific order, and the annual one is use-it-or-lose-it. Each recipient's first $20,000 in a calendar year is simply ignored — it never enters your taxable-gift total and never reduces the lifetime figure. Only the excess is charged against the lifetime exclusion, which is the same pot that shelters your estate at death. So a gift within the annual allowance is genuinely free, while a larger gift is really a pre-payment out of what your heirs would otherwise inherit tax free.

They sit outside it entirely, with no dollar cap at all. Section 2503(e) excludes tuition paid DIRECTLY to an educational institution and medical expenses paid DIRECTLY to a provider, on top of whatever else you give that person that year. The word directly is doing the work: hand the money to the student or patient to pay the bill themselves and it becomes an ordinary gift subject to the normal allowance. Pay the school or the hospital, and it does not count.

$201,000 for 2027, under Rev. Proc. 2026-35 §3.46(2). Gifts between spouses are normally unlimited under the marital deduction, but that deduction is switched off when the recipient spouse is not a U.S. citizen, and this separate indexed allowance replaces it. It runs off the same 1997-based index as the ordinary per-recipient allowance, just applied to a base ten times larger.

The unified schedule in §2001(c) tops out at 40% — the very same one applied at death, which is precisely what makes the exclusion "unified". Being statutory and unindexed, it is unchanged for 2027. In practice it only bites once the whole lifetime allowance has been spent.

Yes, on November 5, 2026, in news release IR-2026-133 and the revenue procedure behind it. Gifting is measured by calendar year, so the higher allowance applies to gifts made on or after January 1, 2027; anything handed over before then still counts against the 2026 limit.