Because the current federal gift tax rate is historically low, and because there is no generation-skipping transfer ("GST") tax applicable to generation-skipping transfers made this year, 2010 presents unique gifting opportunities for individuals wishing to make taxable gifts to children, grandchildren or other loved ones. However,

Time is of the essence.

In order to take advantage of these opportunities, transfers must be completed by the end of the year. On January 1, 2011, current law provides that the estate, gift, and GST tax laws that existed onJanuary 1, 2001, will be reinstated.

What is going on?

As a result of a 2001 tax law, the federal gift tax rate in 2010 is the lowest it has been since the Great Depression, but this law expires 12/31/2010. The current gift tax rate is 35%; in 2011 and later years the rate may be 45% or even 55%.