By Robert Berton, Esq.
Federal Estate taxes are those federal taxes imposed on the transfer of assets upon death of an individual.  A Federal Gift tax is a federal tax imposed on assets which are conveyed as gifts from one individual to another.  As you may be aware, in the year 2010, there was no such Estate or Gift tax at all.  The decision to do away entirely with estate taxes was controversial at the very least.  Some argued that ones’ wealth upon death should remain his, while others believed the federal government was missing out on considerable taxes it could be collecting from the estates of billionaires upon their death.  In 2010, it was decided that for a period of 2 years, that being 2011 and 2012, the Federal Estate/Gift tax would apply to any gift or estate with a value in excess of 5,000,000 for 2011, and in excess of  5,012,000 for 2012.  Therefore, any gift or estate with a value less than 5,012,000 has been and is currently exempt from federal tax.  After this upcoming Presidential Election, it is unknown what will happen with respect to federal gift or estate taxes.