SPONSORED — You know the old saying about death and taxes, but what you may not realize is that death doesn’t excuse you from those taxes. In fact, if you’ll be leaving an inheritance to your children and grandchildren, you might end up passing on more than you thought to a different relative altogether: Uncle Sam.

If you’re concerned about protecting your estate from heavy taxation, you can do more — right now — than you think.

Enjoy the spend

The current lifetime federal estate tax exemption is $5.43 million, according to the Internal Revenue Service, so if you’ll be leaving any more than that behind to your (lucky) heirs, you can count on losing some of your estate to the good old U.S. of A. That’s why it might be a good idea to start reducing your taxable estate now. As a bonus, you’ll get to enjoy seeing your hard-earned dollars at work.

Keep in mind that there are limits to the amount of tax-free cash and assets you can start shelling out. Currently, you can give up to $14,000 annually to as many people as you’d like without incurring gift tax. If you exceed this amount, the excess will be applied toward your lifetime federal estate tax exclusion.

Pay for college

If you’ve got college in mind for your grandchildren (or other familiy members), a 529 plan can be a smart way to make sure this money goes toward college expenses — while reducing your taxable estate.

“With a 529 plan, you can gift up to five years – or $70,000 – upfront. This removes the money from your estate, while allowing you to retain control of the funds,” said Kari Brotherton, CPA and attorney at Ryan, Swanson & Cleveland, PLLC. “As your 529 investment grows, neither you nor your beneficiary will pay taxes on that growth, provided the money is used toward educational expenses.”

If your beneficiaries are of college age already, you’re free to pay their expenses tax-free up to any amount, provided they are paid directly to the educational institution.

Give to charity

Reducing your taxable estate could also help you collect good karma. Giving money to nonprofit organizations or contributing to a charitable gift fund can be a strategic way to reduce your taxable estate — and get some warm fuzzies in return.

A charitable gift fund enables you to make tax-deductible contributions earmarked for charitable causes, and then grow that investment tax-free. You are then free to direct contributions to the non-profit organizations of your choosing. CNN Money recommends contributing to community foundations, which are regionally based charities that invest cash, stock or property donations; pool the gains; and distribute grants to local nonprofits. This may be a good option for those who don’t want the ongoing responsibility of directing the contributions.

Getting started

When it comes to strategic estate planning, it takes a village.

“The key is to have a good team of advisors,” said Brotherton. “Your financial planner can help you create a strategy that suits your lifestyle and future goals. Then, with the help of your attorney, you can begin executing that strategy.”

Remember, life doesn’t have to be all about death and taxes; with a smart estate plan in place, you can enjoy the years to come — while protecting what you’ve built along the way.