5 Estate Planning Moves to Make Before December 31: Tax-Smart Gifting & Wealth Transfer Tips

Every December, my friend Lisa jokes that she has two countdowns going: one to midnight on New Year’s Eve, and another to the estate planning deadline. While her family is busy stocking up on champagne and party hats, she’s double-checking her gifting strategy for the year.

Why? Because December 31 isn’t just about confetti—it’s the finish line for several tax-smart moves that can shrink your future estate tax bill and pass more wealth to loved ones. And Lisa isn’t alone. Many families use year-end as a checkpoint to make sure their financial legacy lines up with their personal goals.

Here are five estate planning moves you might want to make before the ball drops.

1. The Annual Gifting Countdown

Lisa and her husband have three kids and four grandkids. By using the IRS annual gift tax exclusion—$18,000 per person in 2024 (or $36,000 for couples)—they can move a meaningful amount of wealth out of their estate every year. That money can be cash, stock, or even part ownership in the family lake house. If they wait until January? That year’s exclusion is gone forever. It’s a “use it or lose it” opportunity, and Lisa makes sure not to miss it.

2. The Tuition and Doctor’s Bill Trick

Last year, Lisa’s grandson started college, and tuition bills rolled in. Instead of writing him a personal check, she sent the payment directly to the university. Here’s the secret: direct payments for tuition and medical expenses don’t count against the annual exclusion. It was a win-win—her grandson’s education was covered, and her gifting capacity for other family members stayed intact.

3. Locking in Today’s Lifetime Exemption

Lisa also owns part of a family business. With today’s historically high lifetime exemption (over $13 million per individual), she decided to transfer some shares to her children. Why now? Because this exemption is scheduled to drop in 2026. By acting early, Lisa “locks in” today’s generous thresholds—something that could save her family millions down the road.

4. The Legacy of Education: 529 Plans

One of Lisa’s favorite gifts is funding her grandkids’ 529 college savings plans. She can front-load up to five years’ worth of annual exclusions into one lump sum, setting each grandchild up with a strong start. For her, it’s about more than tax efficiency—it’s about making sure her legacy is measured in opportunities, not just dollars.

5. Charitable Giving With Heart

Finally, Lisa ends each year by revisiting her charitable giving plan. Instead of donating cash, she sometimes gifts appreciated stocks. This way, she avoids capital gains tax and the charity gets the full value. One year she even opened a donor-advised fund, which let her secure a deduction right away but spread out the donations to causes close to her heart over several years.

The Takeaway

Lisa’s story isn’t unique—families across the country are quietly making these same year-end moves. Estate planning doesn’t have to be complicated or overwhelming. It’s about aligning your money with your values, reducing unnecessary taxes, and giving yourself the joy of seeing your generosity in action.

So, while you’re making your holiday lists and setting goals for the new year, consider adding one more item: reviewing your estate plan before December 31. It could be the gift that keeps on giving, for generations to come.