25 Dec 2012 Estate and Gift Tax Provisions Set to Expire
By David Spence
On January 1, 2013 the generous estate and gift tax provisions in the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (“2010 Tax Relief Act” or “the Act”) are set to expire. The Act lowered estate, gift, and GST taxes for 2012 by increasing the exemption amount from $1,000,000 to $5,120,000 and by reducing the top tax rate from 55% to 35%. The $5,120,000 exemption is per estate or per lifetime donor—not per recipient. However, due to the new portability provision, up to $10,240,000 in total estate tax exemption is now available for a married couple.
If Congress does not act to renew the provisions, the tax rates and exemptions for estate tax, gift tax, and generation-skipping transfer (“GST”) tax will revert to the pre-2001 levels. This would represent a decrease in the current exemption level from $5,120,000 to $1,000,000 and an increase in the tax rate from 35% to 55%.Disclaimer: This blog and website are public sources of general information concerning our firm and its lawyers, as well as the information presented. They are intended, but not promised or guaranteed, to be correct, complete, and up-to-date as of the date posted. This blog and website are not intended to be, and are not, sources of legal opinion or advice. The materials, information, and communications on this blog and website do not apply to any particular person, entity, or situation, and do not apply to you or to your specific situation. You will need to consult with an attorney and/or other appropriate professional about your specific situation. Thank you.