Currently, an individual can give away in life or bequeath at death up to $5.1 million without any federal gift or estate tax consequences. That's set to drop to $1 million next year, and amounts above that could be taxed at a rate of up to 55 percent.
Lawyers are busy setting up trusts that allow clients to reduce the size of their estates and take advantage of the high gift-tax exemption.
"I tell them, 'No one knows what's going to happen. If you feel you would otherwise be making the gift, do it now. Why take the risk?' " said Kenneth S. Aneckstein, an estate planning lawyer in Baltimore.
For someone just now thinking about setting up a trust, it may be too late to find an available lawyer, Aneckstein said. "They are all busy. It's that intense."
Gonya predicts that the country will go over the "fiscal cliff," but that sometime in January or February, lawmakers will settle on a $3.5 million exemption with a top tax rate of 45 percent.
Michael W. Davis, a Columbia lawyer, said that's a good guess. But he noted that many in estate planning didn't anticipate a couple of years ago that the exemption would be as high as it is today.
"I can't read the minds of our people in Washington," Davis said.
•Capital gains tax rates would rise from 15 percent to 20 percent for most investors.
•Dividends, now taxed at a rate of 15 percent, would be taxed as regular income, at a rate up to 39.6 percent.
•Individuals would be able to shelter only $1 million from federal estate taxes, down from $5.12 million.
•Workers' payroll tax for Social Security would return to 6.2 percent, up from 4.2 percent now. About 25 million people — many of them in middle-class households — would owe the Alternative Minimum Tax, a tax once meant only for the rich.