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To pick a few nits:

He might want to do a "revocable living trust" or any number of ploys to avoid estate tax being taken out of this little bundle on his death.

A revocable living trust isn't about avoiding or reducing estate taxes, it's about avoiding probate expense and delay. It also keeps things private, wills and probate being a matter of public record.

Of course in the meantime he can pick up the tab for some nice dinners and vacations he might take with you and/or your sister, but as far as "gift", just $10000 a year each. If he gives you more than that, he (not you) must pay gift tax.

Strictly speaking, this isn't correct. The $10K annual limit really covers everything - that is, the cost of dinners, little gifts, and vacations, as well as gifts of hard cash. That is, if dad gives each child $10K in cash, he really can't take them to dinner, to Hawaii or Europe, etc. without running afoul of the gift limit. Granted, this would be pretty hard to track down. Still... Incidentally, it's worth mentioning that if brother and sister have spouses, dad can give $20K to each family, $10K each to son, daughter, and son/daughter in law. Likewise if there are grandchildren, $10K to each. It's easy to get rid of money if you have lots of people to give it to!

And to pick the last nit, dad won't actually pay gift tax - i.e. send money to the government - on amounts in excess of $10K per person. Rather, he'll just use up a little of his unified gift/estate credit, which means his eventual estate tax, if any, will be higher. The revenooers will get you in the end.

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