2012 Estate/Gift/GST Tax Exemptions

As I have previously discussed, the estate/gift/GST tax exemption has been set at an unprecedented level, and that will possibly come to end at the end of 2012. This article provides a detailed list of the three exceptions and a summary of how The Tax Relief Unemployment Insurance Re-authorization and Job Creation Act of 2010 will affect the three exceptions. I will provide just a short summary of each one.

• The estate tax exemption will be set at $5,120,000 for 2012, and the top tax rate will be 35%. By 2013, the exemption will fall to $1,000,000 and the top tax rate will be 55%.
• The lifetime gift tax exemption will increase to same amount as the estate tax exemption amount and rate, and will return $1,000,000 and a 55% tax rate in 2013.
• The GST Tax or the Generation Skipping Transfer tax will also be set at $5,120,000 with the top tax rate being 35%. Like the estate and the gift tax exemptions, this will fall to $1,000,000, and the top tax rate will increase to 55%.

See Abrams, Fensterman, Fensterman, Eisman, Formato, Ferrara & Einiger, LLP, April 2012 – Transfer Tax Alert, JDSupra, Apr. 30, 2012.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.