Also, many people may be under the impression that if they give a gift below this year's $5.12 million exemption level, they'll still have some exemption left to use in the future. But any gift made this year counts against the exemption in effect the year they die. So if the exemption drops, as scheduled, to $1 million in 2013, a gift of a million or more made anytime in the past completely exhausts the exemption. The entire remaining estate will be taxed at 55%.

They also have to understand that, to qualify, the gifts must be permanent and irrevocable. The asset doesn't belong to them any more.

For example, many couples consider transferring their home, which is often their biggest asset, but want to remain living there for a while.

They can do that through a personal residence trust but since these cannot be sold while the trust is in effect, most people prefer another kind, a qualified personal residence trust.

Those, however, come with their own restrictions. For one thing, the givers must specify a term for the trust, the length of time they'll stay before their heirs take possession. Choosing the right term is crucial. The givers may be in good health and figure they have a good 10 years before they'll want to move. But if they die before the 10 year term is up, the house reverts back to the estate. "Then it's taxed like it was never given away," said Blattmachr.

Gifts made this year can keep on giving if astutely chosen, according to David Hryck, U.S. Head of International Tax at SNR Denton. That's because the value of transferred assets are figured at the market value at the time of the gift.

Thus, a $5 million stock portfolio transfers for free this year and any amount it appreciates between now and when the giver dies escapes the death taxes it would have been subject to had it not been given away.

Choosing what assets to transfer, then, is an issue.

"You have to do the math," said Hryck, an adviser to major entertainers and businesspeople. "You have to pick and choose which asset to give. You want to give away the one that will go up most in value."

If, for example, there's a choice between a hot tech stock and a slowly appreciating real estate holding, gifting the stock means the estate will pay less in tax.