CAN I JUST GIVE ALL MY PROPERTY AWAY BEFORE I DIE AND AVOID ESTATE TAXES?
No. The government long anticipated this one. If you give away more than $14,000 per year to any one person or non-charitable institution, you are assessed a federal “gift tax,” which applies at the same rate as the estate tax.
Making gifts of less than $14,000, however, can yield substantial estate tax savings if you keep at it for several years. Some other kinds of gifts are exempt from the gift/estate tax as well. You can give an unlimited amount of property to your spouse, unless your spouse is not a U.S. citizen, in which case you can give away up to $101,000 per year free of gift tax. Any property given to a tax-exempt charity avoids federal gift taxes. And money spent directly for someone’s medical bills or school tuition is exempt as well.
Estate Planning Lawyer Tobin assists clients in leveraging the ($14,000.00) annual exclusion by drafting special insurance trusts which escape both income taxation and estate taxation.
Contact the law office of Adam J. Tobin to discuss your personal gifting objectives.