Taking Advantage Of Gift Tax Planning

As part of a comprehensive estate plan, you should consider the use of gifts. Federal estate tax allows for many options to be generous to your heirs, but like most tax laws, there are complex rules and sometimes competing elements that make it important to review each move in light of your complete estate plan.

Our attorneys at Higgins, Roberts & Suprunowicz, P.C., can help you determine the most effective planning strategies to employ to achieve your specific goals, whether wealth preservation, tax avoidance, Medicaid planning or business succession.

Gift And Estate Tax Exclusion Amounts

For 2019, you can gift up to $15,000 per person. Be sure to consult with your lawyer prior to moving forward, as gift tax exclusion amounts may change annually. There is no limit to the number of gifts you can give, and these gifts do not affect your lifetime estate and gift tax limits. These gifts do not need to be reported on your income tax return, but you still may need to file Form 709, even when no tax is due to ensure you maintain your ability to fully utilize the portability of your or your spouse’s lifetime estate and gift tax exclusions.

Can You Make Gifts To A Trust?

If your gift is made to a trust, the gift tax exemption may or may not apply, and you need to understand this element. Our attorneys can explain the technical aspects of these gifts and help to ensure that there are no unpleasant surprises for your estate plan.

Keep Your Estate Plan Up To Date

Gift tax exclusions are currently indexed for inflation and this means that they will retain their usefulness for estate and tax planning, but because these amounts will likely change every few years, it is important that you regularly update your estate plan and your strategies. The gift tax exclusion and the lifetime gift and estate tax exclusion were both increased by the Tax Cuts and Jobs Act in 2018.

Will The Tax Sunset?

A frequent element of many tax laws is the use of a “sunset” provision. In the case of the Tax Cuts and Jobs Act, the increases from the 2017 law will revert, or sunset, in 2025. Congress may extend them during the intervening period, but these are political and inherently unpredictable.

We can help you prepare for the future by using a comprehensive estate plan that remains flexible and updated, protecting you and your family. We can explain how gifts can be a powerful tool to help your loved one’s present and future.

Contact Higgins, Roberts & Suprunowicz, P.C.

To get started on your estate plan, contact the Schenectady estate and trust lawyers of Higgins, Roberts & Suprunowicz, P.C. at 518-631-5609.