Form 709 must be used to report gifts of digital assets when those transfers meet the criteria for gift tax or generation-skipping transfer tax reporting. Digital assets are treated as property for federal gift tax purposes, and their transfer is reported using the same structure and schedules as other noncash gifts.
What qualifies as a digital asset
Digital assets include cryptocurrency and other digital representations of value that are recorded on a distributed ledger or similar technology. When ownership of a digital asset is transferred by gift, the transfer is evaluated under the same gift tax rules that apply to other property.
When digital asset gifts must be reported
A gift of a digital asset must be reported on Form 709 if it exceeds the annual exclusion amount, is a gift of a future interest, is transferred to a trust, or is made to a skip person. The form specifically asks whether any reported gift includes a digital asset, requiring disclosure even when no tax is ultimately due.
How digital asset gifts are reported
Digital asset gifts are reported on Schedule A with a description of the asset, the date of the gift, and the fair market value at the date of transfer. If the gift is a direct skip or involves a trust, it is reported in the appropriate part of Schedule A and may require completion of Schedule D.
Valuation considerations
The value of a digital asset gift is determined as of the date of the gift and must be reported in U.S. dollars. Because digital asset values can fluctuate significantly, accurate valuation on the transfer date is required for proper reporting on Schedule A.
Interaction with other Form 709 schedules
Digital asset gifts reported on Schedule A may affect taxable gift reconciliation in Schedule A, Part 4, prior-period reporting in Schedule B, and exemption allocation in Schedule C or Schedule D when applicable.
Why disclosure is required
Form 709 includes a specific disclosure question regarding digital assets to ensure transparency and accurate classification of these transfers. Reporting establishes a clear record of the gift for lifetime exclusion tracking and future compliance.
This page explains how digital asset gifts are handled on Form 709. For which gifts must be reported, see what gifts must be reported on Form 709. For overall filing steps, see how to file Form 709. For the official form layout and authoritative instructions, refer to the IRS Form 709 official document overview.