Q. Can I reduce my estate by giving gifts of stock from my company? M.D.R., Ft. Myers, Fla.
A. Yes. You can gift stock valued up to $14,000 to any recipient in 2015 ($28,000 for joint gifts by a couple) without any negative federal gift or estate tax consequences, and you can do this every year. There’s no limit on the number of recipients under this annual gift tax exclusion. Gifts that take advantage of the annual exclusion will reduce the value of your taxable estate. Gifts exceeding the annual exclusion are sheltered by the unified federal gift and estate tax exemption. The exemption effectively shelters up to $5.43 million of wealth transfers from federal gift or estate tax in 2015.
Tip: However, lifetime gifts in excess of the $14,000 annual exclusion erode the available unified exemption. Even so, that will work in your favor if the stock appreciates, because the appreciation will be kept out of your taxable estate.