For folks who want to give even more, they should make gifts in 2010.
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We now have enough money to make gifts to the families, as well as these kids.
The possible change is prompting some people to make gifts to use the exemption before 2013.
There are several reasons to make gifts, as opposed to just leaving assets in your estate.
The third way to make gifts is to pay someone else's medical or education bills directly.
Did you make gifts at year-end to kids and other family members, hoping to clean up your estate?
That means wealthy folks who want to make gifts to grandchildren should rush to see their estate lawyers now.
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It turned out that by simply waiting until 2011 to make gifts, it might have been possible to avoid gift tax altogether.
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The checklist begins with a staple of estate planning: Grant your spouse a power of attorney to use your assets to make gifts or set up trusts.
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In addition, the estate and gift tax will remain "unified, " meaning an individual can use his or her entire exemption to make gifts while alive instead of waiting until death.
While going through the legal paces, make sure you and your spouse have durable powers of attorney that specify the right to make gifts, should one of you become incapacitated. 8.
For more on the year-end rush to make gifts and how a proposal by Senator Baucus would chill it, see Ashlea Ebeling, Estate And Gift Tax Bombshell (The Best Revenge).
For flexibility, make sure your durable power of attorney--that is, the power that kicks in if you're not physically or mentally able to make decisions--allows the person holding the power to make gifts on your behalf.
For example, if a rich widower remarries a wealthy woman, the first wife's unused exemption is available only as long as the second wife is still alive, although it can be used to make gifts until her death.
Advisers say some clients are waiting until Dec. 31 to make gifts to grandchildren in case Congress acts before then and to guard against the risk of paying a gift tax and then dying in 2010, when the money can be passed down estate tax-free.
For this reason, it is risky for any senior without long-term care insurance or very large assets to make gifts of any amount, even to charity, because it might jeopardize their ability to enter into nursing home care at any time during the following five years.
That can make deathbed gifts a useful tactic for saving on state death taxes.
Mr. Clark said he is asking other donors to make their gifts before year-end as well.
Those that have the means and desire to make significant gifts should seek competent comprehensive planning advice now.
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Meanwhile, he says conversation is swelling among state treasurers on how they can make it more convenient for people to make 529 gifts.
This exclusion would blow a huge hole in the U.S. estate tax but for one thing: Taxpayers are reluctant to make these gifts.
The issue is whether Clark possessed the requisite mental capacity to make the gifts, and whether those advising her were acting purely on her behalf.
Husbands and wives can make unlimited gifts to each other, with no tax consequences, so long as neither dies within a year after the transfers.
If Paypal is sincere about allowing us to make these gifts, you will have made a difference for 200 children and their families this holiday season.
If you have two children and want each to share equally in your wealth, you could simply make equal gifts to each child and his family each year.
Alternatively, use the REIT shares to make charitable gifts.
Stephen Baker, vice president of industry analysis at NPD Group, says GPS devices make good gifts since consumers have started to flock to them only this year as prices have come down.
At the urging of their financial advisors, greedy descendants or golf buddies, some wealthy folks rushed to make lifetime gifts that would pare down their estates, ruining the holiday season for their lawyers and tax advisers.
But maybe that should make the gifts we give and the gifts we receive all the more precious, and the small flights of fancy and anticipation they offer us all the more appreciated for being rare.
Most IRA minimum withdrawals had to be made by Dec. 31, 2012, but account owners can make cash gifts to charities up to the amount of their December withdrawals through Jan. 31, 2013, and count those as IRA direct donations.
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