My question is she gifted her interest (worth $ 28k per share) would my sister owe the IRS a gift tax as a donor and also my uncle received property as a gift and when the rea property sells to pay debts and divide proceeds would he owe taxes on the money he receives from the sale. ======>No not at all .Currently, a taxpayer does not pay gift tax until they have given away over $5.43 million in their lifetime ( for 2015). ; however, as you mentioned, since the amount of her gift exceeds $14K for 2014(when she gifted her interest to her uncle), she needs to file IRS form 709;aslongas you give gifts to someone in 2014 totalling more than $14K (other than to your spouse), you must file Form 709. However, certain gifts, called future interests, are not subject to the $14K annual exclusion and you must file Form 709 even if the gift was under $14K. So, she needs to file f 709 with the IRS ; she must file the Form 709 no earlier than Jan 1, but not later than Apr.15, of the year after the gift was made.Her uncle , as a donee, does not pay gift tax; the donor is generally responsible for paying the gift tax as said above. However, when he receives any interest income on his gift money( when he deposit it into a bank acct) from a bank, then he needs to pay tax on the interest income from his bank account .