A common strategy for minimizing gift taxes on estates that are larger then the Federal Gift Tax Exclusion (Currently two million dollars) is for the person with the estate to gift some of the estate to their heirs before the person(s) dies.
This year you (And your spouse if your are married) can gift up to $12,000 to a person without incurring Federal Gift taxes.
So lets say you own an estate that is worth 3 million dollars. This estate could include real estate, a business, cash or cash equivalents, farm land, stocks, bonds, mutual funds, etc. Lets say you are married and have two children who are not married. You and your spouse could decide to give each of your children $12,000 without incurring and Federal Gift Taxes.
Real Estate prices and stock prices are currently extremely low. Gifts are valued on the date of transfer. So you may want to consider gifting property that is depressed in value.
Mike Sylvester
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