As 2019 draws to a close and a new decade dawns, we need to think of…tax planning! Some years Congress tweaks the laws more than other years. This was a relatively quiet year for changes. Still, even in a quiet year, some things change due to inflation increases, etc.
Estate Tax Planning
Applicable Exclusion rises from $11.4 million in 2019 to $11.58 million in 2020.
GST Exemption rises from $11.4 million in 2019 to $11.58 million in 2020.
Annual Exclusion for present interest gifts remains at $15,000.
Annual Exclusion for gifts to a Noncitizen Spouse rises to $157,000 in 2020.
In a few years, at the end of 2025, the Applicable Exclusion and the GST Exemption will revert to one-half of their current levels. This isn’t really relevant for most Americans. However, if you have well in excess of these amounts, you may want to consider removing these amounts from your estate while you still have the Exclusion and Exemption to cover the transfers. You still have a few years the law is set to change unless the 2020 elections change things dramatically.
Read More: https://www.aaepa.com/2019/12/tax-planning-for-2020/
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