Public Law 119-73 (01/23/2026)

26 U.S.C. § 2505

Unified credit against gift tax

(a)

General rule

In the case of a citizen or resident of the United States, there shall be allowed as a credit against the tax imposed by section 2501 for each calendar year an amount equal to—
(1)
the applicable credit amount in effect under section 2010(c) which would apply if the donor died as of the end of the calendar year, reduced by
(2)
the sum of the amounts allowable as a credit to the individual under this section for all preceding calendar periods.
For purposes of applying paragraph (2) for any calendar year, the rates of tax in effect under section 2502(a)(2) for such calendar year shall, in lieu of the rates of tax in effect for preceding calendar periods, be used in determining the amounts allowable as a credit under this section for all preceding calendar periods.
(b)

Adjustment to credit for certain gifts made before 1977

The amount allowable under subsection (a) shall be reduced by an amount equal to 20 percent of the aggregate amount allowed as a specific exemption under section 2521 (as in effect before its repeal by the Tax Reform Act of 1976) with respect to gifts made by the individual after .

(c)

Limitation based on amount of tax

The amount of the credit allowed under subsection (a) for any calendar year shall not exceed the amount of the tax imposed by section 2501 for such calendar year.

Pub. L. 94–455, title XX, § 2001(b)(2)90 Stat. 1849Pub. L. 97–34, title IV95 Stat. 299Pub. L. 101–508, title XI, § 11801(a)(40)104 Stat. 1388–521Pub. L. 105–34, title V, § 501(a)(2)111 Stat. 845Pub. L. 107–16, title V, § 521(b)115 Stat. 71Pub. L. 111–312, title III124 Stat. 3300–3303(Added , , ; amended , §§ 401(b), 442(a)(5), , , 321; , (c)(19)(B), , , 1388–528; , , ; , , ; , §§ 301(b), 302(b)(1)(A), (d)(2), 303(b)(1), , .)

Editorial Notes

References in Text

Pub. L. 94–45590 Stat. 1520Section 2521 of this titlesection 2001(b)(3) of Pub. L. 94–455The Tax Reform Act of 1976, referred to in subsec. (b), is , , . was repealed by . For complete classification of this Act to the Code, see Tables.

Amendments

Pub. L. 111–312, § 302(d)(2)2010—Subsec. (a). , inserted concluding provisions.

Pub. L. 111–312, § 303(b)(1)Subsec. (a)(1). , amended par. (1) generally. Prior to amendment, par. (1) read as follows: “the applicable credit amount in effect under section 2010(c) for such calendar year, reduced by”.

Pub. L. 111–312, § 302(b)(1)(A), struck out “(determined as if the applicable exclusion amount were $1,000,000)” after “calendar year”.

Pub. L. 111–312, § 301(b)Pub. L. 107–16, § 521(b)(2), amended subsec. (a)(1) to read as if amendment by , had never been enacted. See 2001 Amendment note below.

Pub. L. 107–16, § 521(b)(2)2001—Subsec. (a)(1). , amended par. (1) generally. Prior to amendment, par. (1) read as follows: “the applicable credit amount in effect under section 2010(c) for such calendar year (determined as if the applicable exclusion amount were $1,000,000), reduced by”.

Pub. L. 107–16, § 521(b)(1), inserted “(determined as if the applicable exclusion amount were $1,000,000)” after “calendar year”.

Pub. L. 105–341997—Subsec. (a)(1). substituted “the applicable credit amount in effect under section 2010(c) for such calendar year” for “$192,800”.

Pub. L. 101–5081990—Subsecs. (b) to (d). redesignated subsecs. (c) and (d) as subsecs. (b) and (c), respectively, and struck out former subsec. (b) which provided for a phase-in of the unified credit against gift tax.

Pub. L. 97–34, § 442(a)(5)(A)1981—Subsec. (a). , substituted in provision preceding par. (1) “year” for “quarter”, and “periods” for “quarters” in par. (2).

Pub. L. 97–34, § 401(b)(1)Subsec. (a)(1). , substituted “$192,800” for “$47,000”.

Pub. L. 97–34, § 401(b)(2)Subsec. (b). , struck out from heading “$47,000” before “credit”, substituted subsec. (a)(1) substitutions for “$192,800” of amounts of “$62,800”, “$79,300”, “$96,300”, “$121,800”, and “$155,800” in the case of gifts made in 1982, 1983, 1984, 1985, and 1986, respectively, for subsec. (a)(1) substitutions for “$47,000” of amounts of “$6,000”, “$30,000”, “$34,000”, “$38,000”, and “$42,500” in the case of gifts made after , and before , after , and before ; after , and before , after , and before , and after , and before , respectively.

Pub. L. 97–34, § 442(a)(5)(B)Subsec. (d). , substituted “year” for “quarter” in two places.

Statutory Notes and Related Subsidiaries

Effective Date of 2010 Amendment

Pub. L. 111–312, title III, § 301(b)124 Stat. 3300, , , provided that the amendment by section 301(b) is effective on and after .

Pub. L. 111–312, title III, § 302(b)(1)(B)124 Stat. 3301

“The amendment made by this paragraph [amending this section] shall apply to gifts made after .”
, , , provided that:

section 302(d)(2) of Pub. L. 111–312section 302(f) of Pub. L. 111–312section 2001 of this titleAmendment by applicable to estates of decedents dying, generation-skipping transfers, and gifts made, after , see , set out as a note under .

section 303(b)(1) of Pub. L. 111–312section 303(c)(1) of Pub. L. 111–312section 2010 of this titleAmendment by applicable to estates of decedents dying and gifts made after , see , set out as a note under .

Effective Date of 2001 Amendment

section 521(b)(1) of Pub. L. 107–16section 521(b)(2) of Pub. L. 107–16Pub. L. 107–16section 2010 of this titleAmendment by applicable to estates of decedents dying, and gifts made, after , and amendment by applicable to gifts made after , see section 521(e)(1), (2) of , set out as a note under .

Effective Date of 1997 Amendment

Pub. L. 105–34section 501(f) of Pub. L. 105–34section 2001 of this titleAmendment by applicable to estates of decedents dying, and gifts made, after , see , set out as a note under .

Effective Date of 1981 Amendment

Pub. L. 97–34, title IV, § 401(c)(2)95 Stat. 300

“The amendments made by subsection (b) [amending this section] shall apply to gifts made after such date [].”
, , , provided that:

section 442(a)(5) of Pub. L. 97–34section 442(e) of Pub. L. 97–34section 2501 of this titleAmendment by applicable with respect to gifts made after , see , set out as a note under .

Savings Provision

Pub. L. 101–508section 11821(b) of Pub. L. 101–508section 45K of this titleFor provisions that nothing in amendment by be construed to affect treatment of certain transactions occurring, property acquired, or items of income, loss, deduction, or credit taken into account prior to , for purposes of determining liability for tax for periods ending after , see , set out as a note under .