Does Illinois impose a state gift tax?
No. Illinois levies no gift tax of its own, so lifetime gifts of vehicles, jewelry, art, or business interests are governed only by federal gift tax rules, with no separate Illinois return, threshold, or deadline.
Why do lifetime gifts still affect Illinois estate tax?
Because the $4,000,000 Illinois exclusion is measured after including adjusted taxable gifts. If the combined total exceeds $4 million, Illinois Form 700 must be filed with the Illinois Attorney General within nine months of death, whether or not a federal return is required, per the Attorney General's estate tax fact sheet. Well-documented gift valuations made now prevent disputes later.
What valuation standard applies to gifted personal property in Illinois?
The federal one. Illinois defines the gross value of transferred property as its value finally determined for federal transfer tax purposes (35 ILCS 405/5), and federal law uses the willing buyer, willing seller standard as of the gift date. We prepare gift appraisals to that fair market value standard so the same report supports both federal reporting and any later Illinois estate tax calculation.
Is the old Illinois rule taxing gifts made within two years of death still in effect?
No. The contemplation-of-death rule belonged to Illinois's repealed inheritance tax, and the current estate tax framework under 35 ILCS 405 contains no such gift-inclusion provision. Commentary repeating the two-year rule describes law that no longer applies.