Basics Concerning Lifetime Gifts Before Dec. 31

The $5.12 million federal gift, estate and GST tax exemption is effective until Dec. 31 2012. For high net worth individuals, the exemptions allow the removal of $5.12 million ($10.24 for married couples) of assets, and their appreciation, from their federal taxable estate. Further saving may arise in states that impose a tax for transfers at death but not a state level gift tax. To take advantage of the exemption individuals can make a gift of cash, stock or real estate outright or in trust, setting up a partnership or LLC.

See "Make Taxable Gifts Before December 31, When the $5.12 Million Federal Gift Tax Exemption Expires" Choate Hall & Stewart LLP (March 27, 2012)

Posted by Myriam Clerge, Associate Editor, Wealth Strategies Journal