What Are the Oklahoma Gift Tax Requirements?

A gift tax is a tax imposed on the transfer of property or money from one person to another without receiving something of at least equal value in return. The individual making the gift, known as the donor, is responsible for paying this tax. This tax ensures that substantial transfers of wealth do not escape taxation simply by being labeled as gifts.

The Status of Oklahoma’s Gift Tax

Residents of Oklahoma are not subject to a state-level gift tax. The state officially repealed its gift tax effective January 1, 1982. Consequently, individuals in Oklahoma can transfer property or assets as gifts to others without incurring any state tax liability.

The elimination of the state’s gift tax simplified the financial landscape for Oklahomans, but it did not remove all tax considerations. Federal gift tax laws still apply, and it is important for residents to understand these separate obligations.

Federal Gift Tax Obligations for Oklahoma Residents

Although Oklahoma has no state gift tax, residents are still subject to federal regulations. For 2025, the Internal Revenue Service (IRS) allows an individual to give up to $19,000 to any number of people without tax consequences or filing requirements. This is known as the annual gift tax exclusion. A gift can include cash, property, or the use of property where the recipient does not pay full market value.

If a gift to a single individual exceeds the $19,000 annual exclusion in 2025, it does not automatically mean taxes are due. The excess amount is instead applied against the donor’s lifetime gift tax exemption. For 2025, this lifetime exemption is $13.99 million per individual. A gift tax return must be filed to report the excess gift, which then reduces the available lifetime exemption amount.

Married couples have the option of “gift splitting.” This allows them to combine their annual exclusions, enabling them to give up to $38,000 to a single recipient in 2025 without a filing requirement. If they give more than that amount, the excess can be applied against their combined lifetime exemption of $27.98 million. This strategy doubles the amount that can be gifted tax-free.

Filing a Federal Gift Tax Return

When a gift exceeds the annual exclusion amount, the donor must file IRS Form 709, the United States Gift Tax Return. The purpose of this form is to report the amount of the gift that surpasses the annual limit. This reported excess is then tracked by the IRS against the donor’s lifetime exemption.

Filing Form 709 is the responsibility of the person who made the gift, not the recipient. The form is due by April 15th of the year following the gift. An extension to file an income tax return also extends the deadline for Form 709. The completed form must be mailed to the IRS as a separate filing from an individual’s annual income tax return.