What is the annual gift tax exclusion per recipient for 2025, and what happens to gifts that exceed this amount?

The annual gift tax exclusion for 2025 is $18,000 per recipient ($36,000 for a married couple using gift-splitting). Gifts exceeding this amount must be reported on Form 709 but do not trigger gift tax until your cumulative lifetime taxable gifts exceed your lifetime exemption of $13.99 million. Gifts made directly to educational institutions for tuition or to medical providers are completely excluded from gift tax without limit and do not count against the annual exclusion.