An inter vivos gift is a gift that is made while one is living rather waiting until after death for a will or the state to distribute the gift. The main reason inter vivos gifts are given are to help avoid inheritance taxes and estate taxes. The Federal IRS laws allow for annual gifts to be made up $13,000 per person. This not only helps to lower the chances that the estate will be assessed estate taxes, but as a gift it keeps the person from having to pay an inheritance tax. If the gift is going to someone other than the spouse or child, who are exempt from inheritance taxes, this can be a large savings for the recipient.