The annual gift tax exclusion for 2012 remains at the 2010 and 2011 level of $13,000. If you are married, you can gift up to $26,000 per donee, per year, by using the gift-splitting rules while avoiding any federal gift tax ramifications. Gifting is a good way to reduce your taxable estate. For example, if you and your spouse have two children, with gift-splitting you can give each child $26,000 in late December and another $26,000 in early January. If your children are married and/or you have grandchildren, the opportunity for making gifts is even greater.

Please contact a friendly JMF estate planning expert.  We would love to sit down with you and review your estate tax plan, particularly in light of the $5,000,000 expemption available only through the end of 2012.  This information, and much more helpful information, is available in our 2011 Year-End Tax Planning Letter.