Tax law welcomes changes in 2019.
There are few constants in life.
One is change.
Another is death.
This makes changes in estate tax law particularly important.
According to a recent Forbes article titled “IRS Announces Higher 2019 Estate And Gift Tax Limits,” there are new changes in the estate law for the coming year.
What can you expect?
The federal exemption amount will rise from $11.18 million to $11.4 million per individual.
For couples filing together, it will rise from $22.36 to $22.8 million.
Not surprisingly, the number of taxable estates has decreased as the exemption has increased.
In 2018, the number of taxable estates was 1,890.
That number was 4,687 in 2013, when the exemption as $5 million.
What about back in 2000, when the exemption was $675,000?
Would you believe the number of taxable estates in 2000 was a whopping 52,000?
Quite a significant decrease from 2000 to present, yes?
The likelihood of your estate being taxed on a federal level is small.
There also is an unlimited marital deduction.
This means your assets can pass to your spouse without estate taxes.
What happens when this surviving spouse dies?
This depends on whether you have elected "portability" in a timely fashion.
For portability to apply, it must be formally elected on the estate tax return of the first spouse.
This must be done even if no tax is due.
Can you avoid estate planning?
Seventeen states and Washington DC still have their own estate and inheritance taxes.
Their exemption thresholds tend to be far lower.
Estate planning involves far more than taxes.
Do not delay.
Work with an experienced estate planning attorney.
Reference: Forbes (November 15, 2018) “IRS Announces Higher 2019 Estate And Gift Tax Limits”