Holiday Gifting Abroad: What Expats Need to Know About U.S. Gift Taxes
The holiday season is a time for giving—but if you’re a U.S. expat, you should also think about gift tax implications. Whether you’re gifting to family abroad or transferring money between international accounts, the IRS may want to know.
Annual gift exclusion
For 2025, you can give up to $18,000 per recipient per year without triggering a gift tax return (Form 709). If you’re married, you and your spouse can jointly give up to $36,000 to the same person tax-free.
What qualifies as a taxable gift?
- Cash transfers
- Property
- Payment of bills or tuition (unless made directly to the institution)
- Forgiving loans
Gifts to non-citizen spouses
If your spouse is not a U.S. citizen, the annual limit for tax-free gifts is $185,000 (2025 limit). Anything above that must be reported.
What doesn’t count?
- Charitable contributions
- Payments made directly for medical or educational expenses
- Gifts under the annual exclusion limit
Why it matters
While most expats don’t owe gift tax, failing to report large gifts can cause issues with the IRS later especially if you’re audited or applying for future estate tax benefits.
Planning a large holiday gift? Consult the team at Expatriate Tax Returns to stay within limits and avoid surprises.
