Giving to the children or the taxman?

Wealth transfer tax systems based on inheritances and inter vivos gifts, rather than estates, allow donors to shift wealth among potential recipients with the goal of minimizing burdens. However, minimization often requires donor give up control over if transfers are made as vivos. Usually, such behavior is difficult analyze many heirs different schedules involved. In this article, we study a simple setting that allows us obtain transparent credible evidence inheritance responses. Swedish could easily lower their bills zero by giving part children. Using detailed administrative data, show minimized in precise fashion. Still, those inheriting just above exemption, only about half avoided tax. Preferences for holding information seem play major roles. Our findings have general policy relevance, because similar (but more complex) avoidance strategies can be used avoid any