Estate Planning and Taxes

While gifting strategies have long been used to reduce the tax liability of large estates, this might be the time to revisit them.

The unified tax credit is an exemption limit that a person has to either gift to others or pass on to heirs without incurring gift or estate taxes. The Tax Cuts and Jobs Act of 2017 significantly increased the basic exclusion amount for the unified credit. As of 2023, the basic exclusion amount is $12.920 million. But the number might reverse to pre-TCJA levels adjusted for inflation beginning in 2026 if it is not made permanent or extended by the regulators. This might leave a lot of opportunities on the table that you will not come across again in your lifetime.

Even if the gift or estate tax limit decrease is not going to affect you, understanding the tax implications of estate planning, including laws that vary by state, is an important aspect of wealth planning. This is where professional insight may be particularly beneficial. Contact the office today to schedule a time to discuss strategies to help minimize taxes and optimize your legacy.

¹ https://www.irs.gov/newsroom/estate-and-gift-tax-faqs
² https://www.irs.gov/businesses/small-businesses-self-employed/whats-new-estate-and-gift-tax

^{This communication is designed to provide accurate and authoritative information on the subjects covered. It is not, however, intended to provide specific legal, tax, or other professional advice. For specific professional assistance, the services of an appropriate professional should be sought.}