Charles Schwab
By Hayden Adams
April 17th, 2026
If you have a large estate, consider gifting during your lifetime as a strategy to help reduce estate taxes.
When you give assets to someone—whether in cash, stocks, or even a car—the government may want to know about it and might even want to collect some taxes. Fortunately, a large portion of your giving and of your estate is excluded from taxation, and there are numerous ways to give assets tax-free, including through
- the annual gift tax exclusion
- the lifetime gift and estate tax exemption
- and direct payments to medical and educational providers on behalf of a loved one
In general, it’s better to give assets to your loved ones while you’re still alive rather than after you pass away. If you have the means, giving today allows your loved ones to benefit from your gifts immediately and provides you with the enjoyment of seeing your gifts improve their lives. In addition, those gifts can grow in value in their hands, rather than yours, which can help reduce your taxable estate.
Lifetime gifting can be a great strategy, as long as you leave yourself enough to live on. For the gift to count, it must be a complete and irrevocable transfer. This article only focuses on the federal tax implications for gifting and estates. Depending on where you live, there could be state tax consequences for your gifts and estate.
