An Affidavit of Gift is a sworn legal document in which the donor (gift-giver) declares under oath that a transfer of property was made voluntarily, without any exchange of money or consideration. This affidavit serves as official proof that a transaction was a bona fide gift rather than a sale, which has significant implications for sales tax, title transfer, and income tax purposes.

The primary legal framework governing gifts in the United States includes common law gift requirements (donative intent, delivery, and acceptance) and federal gift tax provisions under IRC Section 2503. The IRS annual gift tax exclusion allows individuals to give up to $18,000 per recipient (2024) without triggering gift tax reporting requirements. Gifts exceeding this threshold must be reported on IRS Form 709, and the Affidavit of Gift provides the documentary evidence supporting the gift claim.

State motor vehicle departments are the most frequent users of this document. When a vehicle is transferred as a gift, most states either exempt the transaction from sales tax entirely or impose a reduced tax rate. The DMV requires an Affidavit of Gift to verify the transfer was genuinely gratuitous and not a disguised sale designed to avoid sales tax. Making a false statement on a gift affidavit to evade sales tax is a criminal offense in most jurisdictions, typically classified as tax fraud under state revenue codes.

An Affidavit of Gift is most commonly needed when transferring a vehicle title between family members. A parent giving a car to a child, a grandparent gifting a vehicle to a grandchild, or spouses transferring a car between each other all require this affidavit at the DMV. Without it, the DMV will assess sales tax based on the vehicle's fair market value, even if no money changed hands.

This document is also required when gifting personal property of significant value, such as jewelry, artwork, collectibles, or equipment. For insurance purposes, the recipient may need proof of how they acquired the item to establish an insurable interest. Estate planning attorneys frequently use gift affidavits to document inter vivos (during lifetime) gifts as part of a broader strategy to reduce the taxable estate.

Charitable organizations receiving non-cash donations valued at more than $500 require the donor to file IRS Form 8283, and the Affidavit of Gift provides the underlying documentation. For gifts exceeding $5,000 (excluding publicly traded securities), a qualified independent appraisal is also required under IRC Section 170(f)(11).

Failing to document a gift with a proper affidavit can result in the transaction being reclassified as a sale by tax authorities, exposing both parties to back taxes, penalties, and interest. It can also lead to disputes among heirs or family members about whether the transfer was intended as a gift or a loan.

The donor's full legal name, address, and relationship to the recipient must be clearly stated. The relationship between the parties is relevant because many state DMVs limit the sales tax exemption for gifted vehicles to transfers between immediate family members (parents, children, spouses, and sometimes siblings and grandparents).

A detailed description of the gifted property is essential. For vehicles, this includes the year, make, model, VIN (Vehicle Identification Number), current mileage, and license plate number. For other personal property, serial numbers, distinguishing characteristics, and condition should be documented. The more specific the description, the stronger the evidentiary value of the affidavit.

The estimated fair market value of the gift at the time of transfer must be stated. For vehicles, this is typically determined by reference to Kelley Blue Book, NADA Guides, or a comparable valuation source. The fair market value is relevant for gift tax reporting (IRS Form 709) and for determining the recipient's tax basis in the property under IRC Section 1015.

A clear declaration that the transfer is a voluntary gift with no expectation of payment, exchange, or consideration is the core legal statement of the affidavit. The date of the gift establishes when the transfer occurred for tax reporting purposes.

The affidavit must be signed by the donor under penalty of perjury and notarized. Some state DMVs require the recipient to also sign, acknowledging receipt of the gift. A witness signature may be required depending on the jurisdiction. For vehicle gifts, the affidavit is typically submitted alongside the signed title certificate and a completed title transfer application.