With respect to Estate Planning, some things change, and some things remain the same, under the Tax Cuts and Jobs Act recently signed by President Trump.
Some Things Change
- The Federal estate, gift and generation-skipping transfer (“GST”) tax exemption amounts increase from $5 million to $10 million per individual, with additional inflation adjustments as under prior law.
- The increased, inflation-adjusted exemption amounts – $11.2 million for an individual, or a combined $22.4 million for a married couple – are effective January 1, 2018.The Act also provides for future inflation adjustments for 2019 and beyond.
- The increases are set to expire on December 31, 2025, at which time the Federal estate, gift and GST tax exemption amounts will revert to the current $5 million amounts, (as adjusted for inflation).
Some Things Remain the Same
- The highest Gift and Estate tax rate is still 40%.
- Beginning January 1, 2018, the annual gift tax exclusion is 15,000.
- Unlimited gifts between US Spouses
- There are still gift tax exclusions for qualified direct payments of tuition and medical expenses.
- Stepped-up basis for property passing at death remains.
Amanda and I would be happy to meet with you to explore how these changes impact your estate plan.