Deborah Jacobs, the house estate-planning expert at Forbes, has a nice roundup of the rules that Congress set to begin in 2013.
When all was said and done, not much changed.
- The Lifetime Exemption has been now codified at $5 million, plus inflation. This agreement preserved the non-permanent status quo that had existed on the lifetime exemption, and represented a major concession by the Dems, who had sought to lower the transfer tax threshold by about 30%. The outcome will keep the tax bar high enough to avoid imposing liabilities on the vast majority of Americans’ estates — including most large estates.
- The Unlimited Marital Deduction has been made permanent. So, essentially, a married couple’s lifetime exemption will remain twice that of an individual. Unsurprisingly, we heard nothing about expanding this benefit to include same-sex spouses.
- Exemption Portability remains. So, a portion of the personal lifetime exemption that is not used at the end of one’s life may be passed along to one’s spouse. Again, nothing new for same-sex spouses.
- The Top Rate has gone up narrowly, from 35% to 40%.
- The Annual Exclusion on gifts has risen to $14,000, per recipient.
(Please note that this is not legal advice: Speak with a licensed and qualified attorney in your own jurisdiction about your own unique circumstances before making any important legal decisions.)
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