Not So Simple Estate Planning Considerations After 2017 Tax “Simplification”

After the Tax Cuts and Jobs Act passed in December of 2017, the majority of the public’s focus has been on the changes to personal and business income tax. There has not been a lot of media attention or awareness on the legislation’s modifications to how people should approach their estate planning.

The estate and gift tax exemption and the generation-skipping transfer tax exemption were both increased  to $11,180,000 per person. Therefore, during lifetime and at death, a married couple may now transfer a combined $22,360,000 to family and friends without any gift tax or estate tax. However, this increase only lasts until December 31, 2025.

Most individuals and couples believe that due to the change, there is less of a need for them to seek the advice of an estate planner. But with the magic that is the American government, Congress and the President have the ability to reverse the exemptions to 2017 amounts at any time, and with several elections in the time frame before the end of 2025, that possibility of fluctuation is all too real. In general, it is vital that anyone with an estate plan that has seen no alterations in 3 years speak to their estate planning attorney as soon as possible.

See Megan L.W. Jerabek, Not So Simple Estate Planning Considerations After 2017 Tax “Simplifications,” National Tax Review, May 17, 2018.

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