If you are in a position to give, making annual gifts can be an excellent strategy for reducing both your estate and income tax liability. Doing your gift-giving during midyear rather than late in the year is especially smart if you are gifting income-producing real estate. By doing so, you may further reduce your 2017 tax liability.
Not everyone is in a position to “gift” income producing property. But if your estate is of a size where your beneficiaries will inherit a significant amount of money or other assets, considering developing an annual gift strategy and gift to them while you are alive so you can experience the joy your gifts will bring to your loved ones. You can gift $14,000 per person per year without causing any gift tax issues.