Originally Posted by TaxGuru
In general, a taxpayer needs to file a gift tax form when the taxpayer has exceeded the annual $13,000 tax-free gift limit ($12,000 for gifts in 2006-2008).
But it is highly recommended that the taxpayer send in "Form 709 United States Gift (and Generation-Skipping Transfer) Tax Return" every time a transaction has been made with a family member over $13,000 - even if it wasn't a gift.
If the taxpayer gave over the annual exclusion for gift, but it is under the lifetime exclusion amount in 2012. What is the consequences of not filing a Form 709? Is it that when I pass away, the government tracks down all the gifts I made over my life and anything that I exceed the lifetime exclusion needs to remit taxes?