The federal gift tax exemption is currently $1 million — meaning you can gift up to $1 million cumulatively over the course of your lifetime without incurring any gift tax. There is not marriage penalty; married couples can give up to $1 million per spouse.

A gift made under $13,000 in 2009 will not count against your $1 million exemption. This is known as the annual gift tax amount exclusion. Gifting programs take advantage of these exemptions, mapping out a way to pass assets to heirs during one’s lifetime with minimum tax penalties. Assets can be kept within the family or passed to any charities one may feel drawn to. A gifting program not only helps protect assets, it also enables families to decide how hard-earned assets will be spent and allows heirs to benefit from current tax law.

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