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Estate and GST Exemption Update


The December 22nd Tax Cuts and Jobs Act enacted a temporary doubling of the Federal exemption and Generation Skipping Tax (GST) exemption amounts for the years 2018 to 2025. The Federal exemption jumped from $5.49M in 2017 to $11.18M in 2018. Individuals who previously gifted their entire federal exemption amount now have an additional $5.5M of exemption for additional gifting.

Moreover, a feature of the federal estate tax called portability allows married couples to fully preserve both spouses’ exemption, even without trusts. This means starting in 2018, married couples can shield a total of $22.36M from federal estate and gift tax. Important to note is that the increase is temporary; exemption will return to its previous amount at the end of 2025 or sooner.

For more information on how the Federal exemption and Generation Skipping Tax (GST) exemption amounts will impact you, connect with our Estate and Transition Planning Services leader, Elizabeth Stephan, by email (estephan@bpcpa.com) or calling (425) 454 -7990. We’re here to help!