A New Year – A New Tax
As of January 1, 2016, the estate and gift tax exemption amount has increased to $5.45 million per person. This is a growth of $20,000 from the 2015 amount of $5.43 million.
This change means that a person can pass up to $5.45 million to their heirs free from federal estate tax. The money can be passed on during a person’s lifetime or at a person’s death. If a person’s estate exceeds the $5.45 million dollar limit, either that person or that person’s estate will be required to pay a tax of up to 40% of the remaining amount of the estate.
The New Year is the perfect time to talk with your attorney in order to ensure your estate planning documents meet the new estate tax changes and achieve your tax planning goals.