On November 21, 2011, the IRS released its most recent publication on the topic of federal estate and gift taxes. The pub can be accessed at this link by clicking here. This updates the version released on December 14, 2009.
Most gifts are not subject to tax. Likewise, most estates are not subject to estate tax.
If you die during 2011, you can pass estate tax free up to $5,000,000. For those dying in 2012, add another $120,000. Gifts in amounts up to those figures may also be made tax free.
An extra tax free gift is permitted during any given year of up to $13,000.
Related articles on this topic include: