Gift tax exemptions
There are two levels of exemption from the gift tax. First, transfers of up to (as of 2006) $12,000 per person per year are not subject to the tax. An individual can make gifts up to this amount to as many people as they wish each year. A married couple can pool their individual gift exemptions to make gifts worth up to $24,000 per recipient per year without incurring any gift tax. Second, there is a credit that essentially negates the tax on gifts until a total of $1,000,000 has been given by one person to another.
If an individual or couple makes gifts of more than the limit, gift tax is incurred. The individual or couple has the option of paying the gift taxes that year, or to use some of the "unified credit" that would otherwise reduce the estate tax. In some situations it may be advisable to pay the tax in advance to reduce the size of the estate.
In many instances, however, an estate planning strategy is to give the maximum amount possible to as many people as possible to reduce the size of the estate.
Furthermore, transfers (whether by bequest, gift, or inheritance) in excess of $1 million may be subject to a generation-skipping transfer tax if certain other criteria are met.
You are correct, and that is why I said 9999, because it is LESS than the limit and you will not get taxed, if you want to give someone 12 g's then be my guest, and the exemptions you are talking about only relates to familial and personal problems, not giving money to your best friends.
45 mill is still enough to pay a tax as you said, so if we agree on the subject, why the differences?