Shale King Harold Hamm Is Passing Billions to His Heirs Tax-Free

Harold Hamm executed one of the largest wealth transfers in U.S. history last week, handing each of his five children a stake worth about $2.3 billion in Continental Resources Inc., the shale drilling company he founded more than 50 years ago.

Like other ultra-rich Americans, Hamm’s massive gift, years in the making, is likely to be passed down largely tax-free.

Hamm, 76, seems to have relied on two of the most common loopholes for avoiding the U.S.’s 40% estate-and-gift tax levy as he shifted the majority of his fortune. The key to these techniques, both perfectly legal, is to ...