Lifetime gifting has always been an important aspect of comprehensive estate planning.

As the old saying goes, “If you’re giving while you’re living, then you’re knowing where it’s going.” But the new tax legislation passed in December makes gifting even more attractive for wealthy families.

A recent article in the Wall Street Journal, “The $5 Million Tax Break,” points out why lifetime gifting is suddenly so attractive under the new laws. It’s a good article, worth reading, but here are the high points, in a nut-shell:

For the next two years, the gift-tax exemption jumps to $5 million from $1 million for individuals, and to $10 million (up from $2 million) for couples. What’s more, the tax rate on gifts above those amounts fell to 35 percent, from a scheduled 55 percent.

The gift tax has long been a feature of the tax law, and the gift tax exemption in recent years has remained lower than the estate tax exemption to discourage the wealthy from draining their estates through gifts in order to avoid estate taxes. This new gift tax break, however, may be an important tax planning strategy to consider now, especially for family business owners who want to transfer business interests to the next generation.

Why? If you make your gifts now – or within the next two years – you can take advantage of what could be a short-lived tax break, locking in potentially significant tax savings for your heirs. Savings large enough that they could mean the difference between a business continuation or a business failure. Who knows what Congress will do after 2012? While many hope lawmakers will extend the current regime beyond 2012, other events – such as a debt crisis – could render these breaks temporary.