Updated October 18, 2026. Quick answer: Part 2 of Schedule A lists gifts that are direct skips, meaning gifts that are subject to both the gift tax and the generation-skipping transfer tax. They are listed in the order they were made, using the same columns as Part 1. Column (j) is the check box for electing out of the automatic allocation of exemption.
What Part 2 is for
The form describes the part as “Gifts that are direct skips and are subject to both gift tax and generation-skipping transfer tax.” The instructions say “List in Part 2 only those gifts that are currently subject to both the gift and GST taxes.” The return as a whole is explained on the Form 709 page.
Deciding whether a gift is a direct skip
The instructions define the term: “An inter vivos direct skip is a transfer that is:” “Subject to the gift tax,” “Of an interest in property, and” “Made to a skip person.” They add “All three requirements must be met before the gift is subject to the GST tax.”
On who is a skip person: “A donee, who is a natural person, is a skip person if that donee is assigned to a generation that is two or more generations below the generation assignment of the donor.” A trust can be one too: “A donee that is a trust is a skip person if all the interests in the property transferred to the trust (as defined above) are held by skip persons.” The instructions also say “Nonskip person. A nonskip person is any donee who is not a skip person.”
Examples the instructions give
“Example 2. You give $100,000 to your grandchild. This gift is a direct skip that is not made in trust. You should list it in Part 2 of Schedule A.”
A trust example: “Because the trust has no current beneficiaries, there are no present interests in the property transferred to the trust.” The result stated there: “Therefore, the trust itself is a skip person and you should list the gift in Part 2 of Schedule A.”
The reverse case is Part 3. On a gift of a house to a daughter with the remainder to her children, the instructions say “The transfer is an indirect skip, however”. Those gifts are covered on Schedule A Part 3.
Where the number comes from
Columns (a) to (i) work the way they do on Schedule A Part 1. The instructions require the gifts in “chronological order that you made them.” and “Number, describe, and value the gifts as described in the instructions for Part 1.” One more entry rule: “If you made a transfer to a trust that was a direct skip, list the entire gift as one line entry in Part 2.”
The records are the same as for Part 1: the deed or account statement for the description, the valuation support for column (g), and the trust instrument for any gift in trust. The family tree decides the generation. The instructions say “Charitable organizations and trusts, described in sections 511(a)(2) and 511(b)(2), and governmental entities are assigned to the donor’s generation.”
Column (j): section 2632(b) election out
The instructions on the column read: “If you elect under section 2632(b)(3) to not have the automatic allocation rules of section 2632(b) apply to a transfer, enter a check in column (j) next to the transfer.” They continue “You must also attach a statement to Form 709 clearly describing the transaction and the extent to which the automatic allocation is not to apply.” “Reporting a direct skip on a timely filed Form 709 and paying the GST tax on the transfer will qualify as such a statement.”
Split gifts work as they do on Part 1: under the heading “Split Gifts” in Part 2 the instructions say simply “See this heading under Part 1.” See also the gift splitting page.
Where it goes next
The part closes with “Total of Part 2. Add amounts from Part 2, column (i)”. That total joins the others on Schedule A Part 4, line 1. The instructions send the GST computation to Schedule D: “If you entered gifts on Part 2”, the instructions for line 10 say to complete Schedule D.
Edition and line numbers
This page reads Form 709 (2025) and the 2025 Instructions for Form 709. Those are the current files irs.gov served on 2026-10-18, byte-identical to the archived copies. The form’s heading says “For gifts made during calendar year 2025”. Check the year printed on your own Form 709 and use the line numbers and column letters on that year’s form.
Common mistakes
- Listing a gift to a grandchild in Part 1 because it is a family gift. The instructions give the example “You give $100,000 to your grandchild. This gift is a direct skip that is not made in trust.”
- Splitting a direct skip trust into several lines. The instructions say “list the entire gift as one line entry in Part 2.”
- Checking column (j) without an attachment. The instructions say “You must also attach a statement to Form 709 clearly describing the transaction”
Related: Form 709, gift splitting, gift tax limit, and estate planning glossary.
Sources
- Instructions for Form 709 (2025), United States Gift (and Generation-Skipping Transfer) Tax Return, for gifts made during calendar year 2025: https://www.irs.gov/pub/irs-pdf/i709.pdf
- Form 709 (2025), United States Gift (and Generation-Skipping Transfer) Tax Return: https://www.irs.gov/pub/irs-pdf/f709.pdf
Read from the IRS documents linked above on October 18, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the account provider or the IRS is the right place to confirm anything consequential.