The amount that one individual can transfer to a “skip person” free of GST transfer taxes.  The GST tax exemption amount is $1,000,000 in 2006 for lifetime gifts to “skip persons” and $2,000,000 for transfers to “skip persons” that are made upon the individual’s demise.  So, if grandmother gives $3,000,000 to her two grandchildren, $1,000,000 would be exempted from GST tax.  If the grandmother also leaves $3,000,000 to one of her grandchildren (or children) via her will, an additional $1,000,000 will be exempt from tax (because the lifetime gift exclusion amount is subtracted from the exclusion amount available for transfers made upon the grandmother’s demise).    
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