Estate Tax Exemption Projected to Top $11 Million Per Couple in 2018

The estate and gift tax exemption limits for 2018 are expected to increase to $5.6 million from the $5.49 million threshold in 2017. If this were the case, it would mean that couples would be able to leave over $11 million to beneficiaries without triggering the estate or gift tax. The annual allowable exemption for gifts is also expected to increase from $14,000 to $15,000 in 2018. This change represents the first time the yearly gift exclusion has been adjusted since 2013. While these increases make it slightly easier for individuals with significant assets to pass their estate to the next generation, those exceeding the threshold limits for exemption are more excited about the prospect of repeal.

Although estate and gift taxes affect a minute percentage of the American populous and bring in an insignificant amount of tax revenue, Republicans and Democrats are battling mightily along tightly drawn party lines. Democrats are holding the tax out as a great equalizer and a means to reduce social inequality. Republicans point to the ranchers and landowners that struggle to pay hefty estate taxes over multiple generations. Whatever side you chose, the legislative conversation about estate tax repeal will likely intensify before any commitment to action occurs.

See Ashlea Ebeling, Estate Tax Exemption Projected to Top $11 Million Per Couple in 2018, Forbes, September 15, 2017.       

Special thanks to Joel C. Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.