Often it doesn't occur to people until they get older or have a medical episode that they need to figure out what to do with their property. It is possible to gift some of it each year tax free.

According to the Internal Revenue Service website, a single person may gift up to $14,000 in cash or property value per year in 2016 and 2017, and can give this amount to as many people as he or she wishes. The person giving the gift has a lifetime limit of $5.45 million that can be given as gifts. If married, both husband and wife may each give $14,000 per year or $28,000 if gifting one person. If the gift exceeds this limit, then the gift tax is paid by the person giving the gift.When the property value of the real estate exceeds the allowable gift amount, Homeguides.com recommends assigning ownership to the recipient a portion of the property, up to the allowable amount each year, until the total amount of the property is gifted. If a married couple wants to gift their farm to a son or daughter, then they could gift $28,000 worth of the farm each year. If the value of the farm is $140,000, then it would take five years to gift.Another option is to secure the deed with promissory notes. The giver of the property is the grantor, and the recipient is the grantee. The grantor uses a grant deed to gift the entire amount of the property. The grantee would take out a promissory note in the allowable gift amount for the number of years it would take to be gifted. In the previous example, the grantee would sign five promissory notes, and the grantor would forgive one note each year for five years until the property is gifted entirely.For the heirs who are not gifted the real estate property, Susan Lovejoy, of Thrivent Financial in Lehighton, said the division can be made equitable by leaving them the proceeds from stocks, bonds, certificates of deposit, life insurance policy, etc. Funds from stocks, bonds and certificates of deposit can also be gifted.