In a recent “Mesirow Monday” segment on WGN’s Your Money Matters with Jon Hansen, Rebecca Solomon, J.D., LL.M., Senior Vice President and Estate Planning Specialist at Mesirow, discussed considerations for gifting assets to family members during one’s lifetime and the associated tax implications.

During the conversation, Solomon emphasized that financial security should remain the top priority before making gifts. She noted that individuals should ensure their own long-term needs are met before transferring wealth, underscoring the importance of comprehensive financial planning.

Solomon explained that, for those with excess assets beyond their lifetime needs, lifetime gifting can provide both financial and personal benefits. In addition to helping family members when they may need it most—such as during early career stages or for major expenses like home purchases—gifting during life allows individuals to see the impact of their wealth in real time.

Addressing common misconceptions, Solomon clarified that gifts are generally not subject to income tax for either the giver or the recipient. Instead, gifting falls under federal transfer tax rules. She highlighted the availability of an annual exclusion, which allows individuals to gift up to $19,000 per recipient in 2026 without reporting requirements. Married couples can combine their exclusions to gift up to $38,000 per recipient annually.

For gifts exceeding the annual exclusion, Solomon noted that individuals are required to file a federal gift tax return (Form 709). However, she emphasized that these gifts typically do not result in immediate tax liability, as they are applied against the federal lifetime exemption—currently approximately $15 million per individual. As a result, most individuals can make significant gifts over time without incurring federal gift tax.

The discussion also addressed state-level considerations, particularly in Illinois, where estate tax thresholds are lower. Solomon explained that the Illinois estate tax exemption is $4 million per individual and includes a broad range of assets, such as real estate, investment accounts, retirement assets, and life insurance proceeds. She noted that individuals nearing or exceeding this threshold may face estate tax exposure and should consider proactive planning strategies.

“Mesirow works with clients to evaluate their full financial picture and identify opportunities to transfer wealth in a tax-efficient manner while maintaining long-term financial security,” Solomon said. “Thoughtful planning can help families achieve both their personal and legacy goals.”

Mesirow Wealth Advisors collaborate closely with clients and their broader advisory teams, including CPAs and estate planning attorneys, to deliver coordinated strategies tailored to individual circumstances and multigenerational objectives.

Mesirow Wealth Management is the firm’s founding capability, connecting clients to what matters today and across generations. The firm’s Wealth Advisors bring personal, comprehensive planning, expert investment guidance, and exceptional service to individuals and families. Learn more at mesirow.com/wealth.