Transfer taxes

Transfer taxes are imposed on the passing of title to property from one person (or entity) to another. Gift and estate taxes are both transfer taxes. Transfer taxes can be levied at the federal, state and local levels, depending on the type of property being transferred. States and local municipalities often tax the transfer of legal deeds, certificates and titles to property, while the Internal Revenue Service (IRS) taxes the value of the property itself through gift and estate taxes.

709 form
United States Gift (and Generation-Skipping Transfer) Tax Return is used to report gift taxes
706 form
United States Estate (and Generation-Skipping Transfer) Tax Return is used to report estate taxes
8288 forms
U.S. Withholding Tax Return for Dispositions by Foreign Persons of U.S. Real Property Interests

Forms Available for Transfer Taxes

Transfer tax is determined as a payment for passing either a title or property from one individual to another. It can also be a whole entity. Generally, transfer taxes are considered as some sort of transaction charge which is imposed on the process of transfer of a title to a property. The fees are different according to different states and locations.

It is significant to mention that this type of tax is demanded in case there is a request to legally register the transfers considering real estate, bond, shares and stamp duty. Consequently, the Internal Revenue Service offers a specially designed real estate transfer tax form. Every individual who deals with the transfers of the above-mentioned kinds are to file it.

Here are the forms to be filled out by applicants who pay federal taxes: 709, 706, 8288 (8288-A, 8288-B). Let us investigate each one in more detail.

Form 709 is U.S. Gift (and Generation-Skipping Transfer) Tax Return. It includes a section for General Information, Tax Computation, and Signature which is possible to do online.

Form 706 is U.S. Estate (and Generation-Skipping Transfer) Tax Return. This statement is to be submitted for all decedents who died after the 31st of December 2012.

Form 8288 is U.S. Withholding Tax Return for Dispositions by Foreign Persons of U.S. Real Property Interests. There are two parts. The first one is to be completed by the buyer or other transferee required to withhold under section 1445(a). The second one is to be completed by an entity subject to the provisions of section 1445(e). Its key purpose is a transfer tax return.

Forms 8288-A and 8288-B are almost the same as a conventional 8288, but they have some specific conditions for those filling them out.

Estate Generation Skipping Transfer Tax Definitions

Transfer taxes