Effective January 1, 2018 and as a part of the tax legislation signed by President Trump, the federal estate, gift, and generation-skipping transfer (“GST”) tax exemption amounts increased from $5,490,000 (2017) to $11,200,000 for individuals and from $10,980,000 (2017) to $22,400,000 for married couples. These exemption amounts are scheduled to increase with inflation each year through 2025, until January 1, 2026 when they are to revert to the 2017 levels and as adjusted for inflation. In addition to the increased exemption amounts, the annual exclusion amount for gifting in a year (the amount you can give each person to as may persons you desire without including federal gift tax) increases from $14,000 (2017) to $15,000 for an individual. For a married couple this allows for up to a total of $30,000 to be made to an unlimited number of recipients. The changes in the exemption amounts and the GST exemption amounts may warrant changes to estate plans, and in particular those plans that were executed at a time when the exemption amount was far less than it is today. Some of these older estate plans include funding formulas that were preferred when they were prepared but which today may cause unexpected or undesirable results.
Please contact the attorneys at Thomas Law Group if you would like to review your estate plan, including any trusts that you may have executed.