Estate Planning Exam 2 Review CH 5, 6, and 8

Estate Planning Exam 2 Review CH 5, 6,
and 8

Unified Gift and Estate Tax System

Exclusions and Rates

 Annual exclusion of $18,000 per year per donee (2x for married couples)

 Lifetime gift and estate exclusion of $13,610,000 (2x for married couples)

 40% flat tax rate

 Income tax implications of gifts and inheritances

 Step-up in basis for testamentary bequests

 Carry-over basis for inter-vivos gifts

Unified Gift and Estate Tax Examples

 Single person gifting $18,000 to every person in the room

 Gifts in December and January

 Married person gifting $136,000 to 10 people in the room

 Split gifts example

 Annual exclusion and taxable gifts calculation

Estate Tax Exclusions Over the Years

 2011: $5,000,000 estate tax exclusion

 2024: $13,610,000 estate tax exclusion

 2025: Indexed estate tax exclusion

 2026: $7,300,000 estate tax exclusion

Completed vs. Incomplete Gifts

Definitions

 Completed gifts are gifts that have come to fruition