2019 Estate & Gift Tax Exemptions

Information for 2018 is here. Generally speaking, the Basic Exclusion Amount (BEA) is the aggregate amount a taxpayer may transfer, during life and/or at death, to persons other than spouse or charity without incurring estate or gift tax.  In certain cases, the BEA can be augmented by the Deceased Spouse Unused Exemption Amount (DSUEA); i.e., unused exemption the taxpayer “inherited” from a deceased spouse. For purposes of completing a federal estate tax return (Form 706) or gift tax return (Form 709) the BEA is converted into a tax credit amount known as the Applicable Credit Amount. The Generation-Skipping Transfer (GST) Tax is a tax separate from, but related to, the estate and gift taxes. It generally applies when property passes, […]

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Are Capital Gains Subject to the 65-Day Rule?

No, but you would not know that from reading the statute. 

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2018 Federal Income Tax Rates: Estates and Trusts

These numbers will be adjusted annually for inflation based on the chained consumer price index (C-CPI-U). For more on the Tax Cuts and Jobs Act, click here. Source: Joint Explanatory Statement of the Committee of Conference, p. 13 (pdf) Posted by Joel D. Roettger, JD, LLM, EPLS  

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Prepaying State and Local Taxes in 2017

Don’t bother. 

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Estate and Gift Tax Exemptions Will Rise in 2018

The IRS recently announced inflation adjustments to various estate and gift tax items for 2018.

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Considering Serving as Executor of an Estate Subject to a Tax Lien?

A recent case from the Southern District of Indiana might make you think twice.

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Estate Planning for Retirement Assets in a Nutshell

When the owner of an IRA or 401(k) plan dies, the plan must pay out over some period of time. This is true regardless of whether the IRA/401(k) is a traditional account or a Roth account. The only exception is when the surviving spouse is named a beneficiary. In that case, the surviving spouse has the option of rolling over the decedent’s account to his or her own account. Amounts distributed from a retirement plan–excluding Roth distributions–generally constitute taxable income to the recipient. From an income tax standpoint, the best result is to “stretch out” payments for as long as possible. This is desirable even with a Roth account, because amounts remaining in the account continue to grow tax-free. The tax rules […]

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Funding a Trust with Annuities? Beware.

There are income tax consequences to transferring annuities for less than full and adequate consideration. If you are considering making a gift of annuities in trust, keep the following in mind: If an individual who holds an annuity contract transfers it without full and adequate consideration, such individual shall be treated as receiving an amount equal to the excess of the cash surrender value of such contract at the time of transfer, over the investment in such contract at such time, under the contract as an amount not received as an annuity. In other words, gifting an annuity triggers gain to the annuity owner to the extent the cash surrender value exceeds basis, as a general rule. In may be […]

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