Federal gift tax and estate tax are the obverse and reverse sides of the same coin, intended to tax transfer of wealth whether you are alive or dead. Federal estate tax is an extraordinarily high progressive tax which taxes most types of property and property rights that a person owns, or is deemed by law to own at that person s death.
Careful planning can convert almost-confiscatory Federal estate taxes to a zero tax plan.
A simple living Trust will not save any tax. Keeping property in a Trust and out of your probate estate does NOT mean you pay no income tax on income from that asset. Nor does it mean the asset is out of the taxable estate for federal estate tax purposes. To accomplish tax savings of either kind, a variety of more complicated, irrevocable Trusts are available. There is major misunderstanding among Americans that a living trust avoids taxes.