I have read that an IRS 709 form should be filed because of this gift.=====>.yes ;since the amount of the gift for your son exceeded $14K, annual exclusion from gift taxes, you need to file form 709; You cannot file a joint gift tax return. If you and your spouse each made gifts valued over $14k, you both must file a Form 709.
I have examined the 709 form which is very complicated, and read comments on tax related forums that even CPA's find the form daunting. ==========>I think so.
I realize the practical purpose of the form is to insure that correct property taxes be paid when large gifts were made during a person's life and the estate he leaves behind exceeds 5.4 million dollars.===>> correct; gifts in excess of the annual exclusion may still be tax-free up to the lifetime estate basic exclusion amount ,$5,340k in 2014, although for estates over that amount such gifts might increase estate taxes. Taxpayers that expect to have a taxable estate may sometimes prefer to pay gift taxes as they occur, rather than saving them up as part of the estate.
My theoretical question is - what happens if a person never fills out the 709. If the person made a modest gift to a son, and will never be in a position in which he will be liable for any estate taxes.==>> as you made a gift to a son or any gift that would be considered a future interest, yes you need to file. If you are required to file, then you must file amend the 1040 regardless of the net effect. Do not file with your 1040 form - there is a different address for the gift tax return. File Form 709 at the following address . UNLESS your cumulative gift amount exceeds $5.4 million, no tax is liable.