“Tax Exemption Adjustments”
The Internal Revenue Service has announced annual inflation adjustments for more than two dozen tax provisions.
The Internal Revenue Service has announced annual inflation adjustments for more than two dozen tax provisions. Of note to those interested in estate planning is the increase in the amount of the federal gift tax annual exclusion from $13,000 (in 2012) to $14,000 (in 2013). The gift tax annual exclusion is the amount of a present interest gift that a taxpayer can make to each recipient of a gift in a calendar year without having to file a federal gift tax return or utilize any of the taxpayer’s lifetime exemption.
The Rhode Island Division of Taxation has announced that the estate tax threshold for the estates of decedents dying in 2013 will be $910,725. This is an increase from the existing threshold (in 2012) of $892,865. In general, for a decedent dying in 2013, a net taxable estate valued at $910,725 or less will not be subject to Rhode Island’s estate tax. This compares to the Massachusetts estate tax threshold of $1,000,000.
For more information about these adjustments and other estate planning issues, please contact your Partridge Snow & Hahn LLP estate planning attorney.