Share your insights or perspective on the financial matter presented in the input.

What laws/regulations are there regardings gifts in the form of large sums of money?
This forum is not intended to be a discussion group, but I would like to add a different perspective, especially for @MrChrister, on  @littleadv's rhetorical question  "... estates are after-tax money, i.e.: income tax has been paid on them,    yet the government taxes them again. Why?" For the cash in an estate, yes, that is after-tax money, but consider other assets such as stocks and real estate. Suppose a rich man bought stock in a small computer start-up company at $10 a share about 35 years ago, and that stock is now worth $500 a share. The man dies and his will bequeaths the shares to his son. According to US tax law, the son's basis in the shares is $500 per share, that is, if the son sells the shares, his capital gains are computed as if he had purchased the shares for $500 each. The son pays no taxes on the inheritance he receives. The deceased father's last income tax return (filed by the executor of the father's will) does not list the $490/share gain as a capital gain since the father did not sell the stock (the gain is what is called an unrealized gain), and so there is no income tax due from the father on the $490/share. Now, if there is no estate tax whatsoever, the father's estate  tax return pays no tax on that gain of $490 per share either. Would this be considered an equitable system? Should the government not tax the gain at all? It is worth noting that it would be possible for a government to eliminate estate taxes entirely, but instead have tax laws  that say that unrealized gains on the deceased's property would be taxed (as capital gains) on the deceased's final tax return.