Elements of Proof for a Gift in Texas

In Texas, a gift is made when the owner of an item of property delivers it to another person without any expectation of receiving something of value in return.

Texas does not collect gift taxes of any type, but the legal definition of a gift might arise in other legal situations, e.g., if money given by one individual to another was a loan that should be repaid or a gift. A legal consultation in Texas with a Texas lawyer would assist a person who has an issue with a legal problem that involves a gift.

Importantly, the federal Internal Revenue Service (IRS) does enforce federal tax law regarding the taxation of gifts. So, when making a gift an individual must take into account federal gift tax laws and regulations. The federal government imposes gift taxes on transfers of money or property exceeding certain limits.

As of 2025, the annual gift tax exclusion amount is $19,000 per recipient. This means that an individual can give up to $19,000 to any one recipient annually without federal gift tax consequences. Married couples can each give up to $19,000 per year for a combined total of $38,000 per recipient annually.

If a person should make a gift with a value that exceeds $19,000 in one year, they need to file a completed Form 709 with the IRS reporting the gift and its value. The reporting on the Form 709 allows the IRS to keep track of an individual’s gifts across their lifetime. The IRS would then know whether the lifetime total exceeds the lifetime gift tax exemption. This is coordinated with the estate tax exemption.

In 2025, the federal lifetime gift and estate tax exemption is $13.92 million per individual. This means an individual can donate this total amount in their lifetime without having to pay any gift tax. There is one consequence, however, and it is that the total amount of gifts reduces the amount available for federal estate tax purposes upon the death of the donor.

Federal law regarding gift taxes is coordinated with estate law, so a person who plans to donate significant sums during their lifetime would want to consult a Texas estate lawyer for guidance.

Certain kinds of gifts are exempt from the annual exemption. This means that they simply do not count for the annual exclusion and carry no gift tax consequences. An example is a direct payment of tuition to a school or college for another individual. Another example would be payments to cover the medical expenses of another person. These would not count towards the donor’s annual exclusion amount. So amounts paid over $19,000 in one year would not add to a person’s lifetime total.

In Texas, How Can I Prove the Elements of a Gift?

The elements of proof for a gift are the same in many states and in federal law. Whether a valid legal gift has been made depends on five conditions as follows:

• Delivery: The donor has to deliver a gift deed to the recipient if the gift is one of real property. If the gift is an item of personal property, the item must be delivered to the recipient.
• Intent: The donor must intend to make a gift of the item.
• Acceptance: The recipient must accept the item given by the donor.
• No Exchange of Value: As mentioned above, the donor must not receive anything of value in return for their gift.
• Mental Competence: Both the donor and the recipient must have mental competence and not be subject to any undue influence or duress. The donor must not have been induced to make their gift by fraudulent misrepresentation.

Proving intent, if it comes into question, would be the most challenging. An individual would use the generally accepted forms of evidence to prove a gift, e.g., the testimony of witnesses and written documentation. Such items as text messages, emails, and written records that were part of the gift transaction might be helpful for proving a gift.

What Can Be Transferred as a Gift in Texas?

Virtually any item can be given as a gift. Of course, common gifts are cash, jewelry, cars, and vacation trips. People might make gifts of furniture, both ordinary household items and valuable antiques. However, an individual can also make a gift of intellectual property, such as patents and copyrights. A person may also make a gift of financial assets such as stocks, bonds, and investment accounts. Generally, gifts are not subject to state or federal income tax.

Gift cards present an interesting exception to the general rule that gifts are not taxable as income to the recipient. The IRS views gift cards given by an employer to an employee as a bonus or reward as income to the employee. They are subject to federal income tax withholding, as well as Social Security and Medicare tax withholdings.

Employers are responsible for reporting the value of any gift cards given to employees on their Form W-2. The IRS considers gift cards to be the equivalent of cash because of their value and ease of using them for purchasing goods.

People often give gifts of real property to their family members, e.g., spouses and children. In Texas, it is important for property owners to use a Texas gift deed to give property to their spouse and even to add a spouse to the title of a home they owned before their marriage. Assuming the spouse does not pay for the transfer, it is a gift and should be treated as such.

A person would also use a gift deed if they were to make a gift of real property to their children or any other family member. The requirements for a valid Texas gift deed are similar to the requirements in Texas property law for most deeds that transfer ownership of real property.

A gift deed must be in written form. It has to include the full name of the owner who is transferring their ownership. It must also include the full name, address and vesting of the new owner. As is the case with all deeds, a gift deed must include a description of the property that is transferred.

Again, these requirements for gifts of real property are set forth in Texas property law, which must be consulted and respected.

Can I Legally Take a Gift Back in Texas?

A gift can be recovered in certain very limited circumstances. Generally, however, once a person has made a gift as defined by Texas law, it is irreversible. It is important to note that a gift of real property made with a deed that complies with all of the formalities and has been filed in the office of the County Clerk in which the property is located cannot be revoked or reversed.

An exception to the rule that a gift of property cannot be revoked is a gift that is conditional. This is a gift made on the condition that a certain event happens in the future. An engagement ring is the example that is usually cited. It is given on the condition that the marriage of the donor and the recipient takes place. If the marriage does not in fact happen, the recipient is legally obligated to return the ring to the donor.

There are circumstances under which a gift may be legally revoked. If the donor was subject to undue influence or lacked the necessary mental capacity when they made the gift, it might be revocable.

If the donor was persuaded to make a gift by fraudulent misrepresentation or if the gift is one that violates public policy or involves criminal activities in some way, it might be reversible.

Do I Need a Lawyer for Assistance With a Gift?

If you have made significant gifts or plan to do so in the future, you want to speak to a Texas estate lawyer. Your lawyer can advise you as to all of the possible tax and estate law consequences, both state and federal. You want to avoid making any costly mistakes that result in taxes owed that could have been avoided with good planning guided by a knowledgeable Texas estate lawyer.