A Gift Tax return is a form that individuals must file with the IRS when they give gifts exceeding a certain value in a year. As of 2023, the annual exclusion amount is $17,000 per recipient. If a gift exceeds this limit, the giver may need to report it, even if no tax is owed. The purpose of the Gift Tax return is to track large gifts and ensure compliance with tax laws. It helps the IRS monitor potential taxable gifts and the overall wealth transfer between individuals. Filing this return does not necessarily mean taxes are due; it simply documents the gift.