The Tax Relief Act of 2010 allows for much higher exemption rates for estates and gifting for individuals and married couples. However, the Act’s provisions are only scheduled until January 1, 2013, after which the unified tax credit will decrease again. If you have not reviewed your estate plan to reflect this Act and its tax exemptions, don’t wait until the opportunity passes you by. An Arizona estate planning lawyer can help you take advantage of this chance.
Estate, gift, and generation-skipping transfer (GST) taxes are greatly affected by the Act for the rest of the year. In 2012, individuals have an exemption of $5.12 million, and married couples, with proper planning, are allowed $10.24 million in gift, estate, and GST exemptions.
In addition, the Act also allows an individual whose spouse dies before them to inherit any leftover tax credit that their deceased spouse didn’t use.
The table below shows the fluctuating taxes and exemptions relating to estates, gifts, and GSTs from 2010-2013.
RATES AND EXEMPTIONS UNDER TAX RELIEF ACT OF 2010
|As of Jan 1||2010||2011||2012||2013|
|Estate tax rate||35%||35%||35%||55%|
|Estate tax exemption||$5 million||$5 million||$5 million||$1 million|
|Gift tax rate||35%||35%||35%||55%|
|Gift tax exemption||$1 million||$5 million||$5 million||$1 million|
|GST tax rate||0%||35%||35%||55%|
|GST tax exemption||$5 million||$5 million||$5 million||$1.35 million|
If you want to take advantage of the limited estate, gift, and GST tax exemptions and need to update your estate plan, schedule a consultation with an experienced and knowledgeable Arizona estate planning attorney. Dial (480)-464-1111 to increase your tax exemptions by planning a meeting with estate planning attorney, Dave Weed today.