When the value of your home exceeds the inheritance tax exclusion you are going to look at the tax efficiency strategies. Depending on the specific nature of your ability a number of different estate planning tools, either alone or in combination. Some are a bit complicated, and others, such as tax-free gift giving, are simple but very useful on more levels than one.

The thing that makes gifting a twofold solution is that you can use the experience of giving something of value to a loved one, while reducing the taxable value of your property to enjoy the process.

There is a gift tax, that the same rate as the inheritance tax for people to discourage taking this route, and the estate tax exclusion and the lifetime gift tax exemption bears are united. This unification means that if a portion of your lifetime $ 5,000,000 gift tax exemption to use a good gift tax exclusion is reduced by the amount of that gift giving.

Other exemptions already exist, and one of them is the educational gift exemption. U.S. taxpayers have a right to the school to pay tuition fees of an unlimited number of students, equal to a sum of money, free of gift tax. So you can open the way for your loved ones, check them enjoy the gift of education, while still alive, and all reduce the taxable value of your home in one fell swoop.

It should be the educational exemption can only be used for tuition, books and not pay, and you have to pay the tuition directly to the school. However, each person can give tax-free gifts of up to $ 13,000 per year an unlimited number of recipients. If you are married you and your spouse can give as much as $ 26,000 annually, and this should be sufficient to fees and living expenses to cover.