Lifetime gifts are the most common way to reduce the eventual estate tax and are often used as part of broader charitable and family wealth-transfer strategies. Gifts may be of cash, securities, real estate, art… pretty much any asset. We are tempted by hearsay to think the limit is $17,000 per giver per recipient, but there is much more freedom than that.

For Washington State estate tax reduction, there is no limit — lifetime gifts aren’t considered in the eventual State estate tax. For Federal purposes, gifts can affect the eventual estate tax. There is a seeming $17,000 limit but that only means that, if one exceeds it, one must file a gift tax return showing that a portion of one’s roughly $12.92 million Federal estate tax exemption has been used. This isn’t an issue for anyone with an estate well below that level (twice that level for couples with properly structured Wills or Living Trust).

Coordinating gift strategies with properly drafted estate documents helps ensure assets are transferred efficiently and in accordance with your long-term goals.