Gift tax in the United States
If a person is a non-resident alien for purposes of gift tax, taxation of gifts is determined in a different way. If the property is not located in the U.S., there is no gift tax. If it is intangible property, such as shares in U.S. corporations and interests in partnerships or LLCs, there is no gift tax.
Gift Tax Act, 1958
There were certain exemptions that were allowed under the Gift Tax. In case of the exchange of gifts between blood relatives, irrespective of the value of the gift, Gift Tax was not applicable. Gift Tax was also not applicable in case of the transfers of immovable property that were situated outside the country. Gifts that were received from relatives for marriage, including gifts to the daughter in law from the bridegroom’s parents, and gifts to the son in law from the bride’s parents were also exempt from tax. Gifts received through a will or through inheritance as well as gifts to parents from their NRI sons and daughters through their NRE account were also under the Gift Tax exempt list.