Coldwater Creek, I say a quick prayer for you. Bless you for considering your inheritance even when faced with terminal lung disease.
There is a set amount of money you can give someone per year without them having to declare it on their taxes. I think it is $4000. Someone out there can correct me if I’m wrong.
If I were you, I’d try to disburse some of that even now. Tell them what you are doing and why.
The annual exclusion for 2010 is $13,000 per recipient. A couple can give $13,000 FROM each person (2x 13,000) TO each person.
So, if a couple is giving to another couple they can give 4x $13,000 or $52,000 this year.