Estate Planning and the Annual Gift Exclusion

"Given the uncertainty about next year's estate taxes, using this exclusion is often a good idea," says Beth Kaufman, an estate-tax attorney at Caplin & Drysdale in Washington.

The uncertainty of estate taxes may make you feel uneasy, but rest assured – there is still one safe bet for your wealth transfer plans in the form of the annual gift exclusion.

The Wall Street Journal recently took up the praises of the annual gift exclusion in an article aptly titled “The Gift That Keeps Giving.” Indeed, gifts will keep giving, and it’s important to know how they work and how to give them appropriately.

Currently you can give up to your annual exclusion to as many parties as you wish each calendar year, without any corresponding reduction in your lifetime gift/estate tax exemption. The current annual gift exemption is set to $13,000 and will expand with inflation.

Don’t forget, if you are married, “gift splitting” is a way to give $26,000 to your loved ones. This is especially important in blended families when the entire $26,000 will be coming from separate resources of one spouse to his or her own children. Note: there is some simple IRS paperwork required to make this work.

Maximizing the annual gift exclusion truly is a simple yet important way to transfer your wealth. Your professional counsel can help guide you through this gifting process.

Reference: The Wall Street Journal (August 17, 2012) “The Gift That Keeps Giving

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Update to our Process

The unprecedented coronavirus pandemic has taken our entire country by surprise. We understand how difficult this time is for America’s businesses and families.  However, we believe it is vitally important that we make every effort possible to continue to offer solutions that avoid disrupting our important partnership with you, your family and friends.  As you know, estate planning is not something that should wait for a more convenient time, therefore the opportunity to address your important goals both during and after this crisis should not wait.  To that end, we have added the option of a ‘virtual consultation’ to our office process.  You will now have a choice of either meeting with us in our office or in the comfort of your own home.