At a certain point, wealth planning becomes less about accumulation and more about intention. You’ve built something meaningful, and now the question becomes how to pass it on with purpose and efficiency.
For families who act as stewards of multi-generational wealth, gifting isn’t just a tax strategy. It’s an act of leadership, a way to share values, promote responsibility, and reinforce the legacy you’ve worked a lifetime to build.
Here we explore five core concepts that can help shape a lifetime gifting strategy.
The Annual Gift: A Simple Strategy with Long-Term Power
The IRS allows individuals to gift up to $19,000 per recipient in 2025 without triggering gift taxes or using up their lifetime exemption. For couples, that amount doubles. Spread across children, grandchildren, and even in-laws or trusted advisors, this can result in meaningful wealth transfer without needing to file a gift tax return.
But beyond the math, there’s momentum. Annual giving creates a rhythm, whether to fund education, support a first home, or seed an investment account that helps younger generations become more engaged and financially literate over time.
Gifting with the Lifetime Exemption in Mind
While the lifetime gift and estate tax exemption currently stands at $13.99 million per individual, it’s set to drop to approximately $7 million in 2026 unless legislative action extends it. That pending reduction presents a rare window of opportunity.
For high-net-worth families, it may make sense to “use it before you lose it.” That could mean transferring family business interests, real estate, or other appreciating assets to heirs now while minimizing future estate taxes. In many cases, this also allows those assets to grow outside your taxable estate, potentially compounding your impact across generations.
Navigating Cost Basis and Capital Gains
When gifting appreciated assets like stock or real estate, recipients inherit the original cost basis. That means if they sell, capital gains taxes are calculated based on what you originally paid, not the asset’s value at the time of the gift.
This can be efficient when recipients are in lower tax brackets but counterproductive in other scenarios. That’s why we help clients take a strategic approach, identifying whether it makes sense to gift high-growth assets early, hold them for a step-up on a basis at death, or consider alternate paths like charitable giving.
Strategic Use of Trusts
For many families, trusts become the cornerstone of a lifetime gifting strategy. They can protect assets, enforce boundaries, and transfer wealth with discretion. Some common approaches include:
- Irrevocable trusts remove assets from the taxable estate and can be structured to make use of the annual gift exclusion.
- Grantor trusts allow the donor to pay income taxes, further reducing their estate while keeping the trust assets growing for the beneficiaries.
- Dynasty trusts can support multiple generations while offering protection from future estate taxes, creditors, or divorces.
Trusts are never one-size-fits-all. That’s why it’s essential to understand your priorities so the financial structures in place reflect what matters most to you.
Beyond Taxes: What Gifting Really Transfers
The numbers matter but wealth transfer is never just transactional; it’s transformational. The conversations, decisions, and structures you put in place today shape how your family relates to money, to each other, and to your values for decades to come.
Whether your goal is to empower adult children, support education, contribute to a family philanthropy vision, or gradually prepare heirs for more responsibility, gifting is a chance to communicate, not just transfer, your legacy.
Planning with Precision and Perspective
Like everything in estate planning, the most effective gifting strategies are both proactive and adaptable. Tax laws evolve. Family dynamics shift. That’s why the best wealth transfer planning isn’t a one-time event but a living, breathing process.
At WealthCrossing, we approach wealth transfer through the lens of strategic tax planning, helping clients explore options that reflect what matters most to them. If you’re considering lifetime gifts or want to better understand the tax implications of your current approach, we welcome a conversation.
