FEDERAL
Estate and Gift Tax Applicable Exclusion:
The amount that can be passed free of federal tax. Whatever amount is used during lifetime is no longer available for use to pass assets at death. The Estate and Gift Tax Applicable Exclusion is currently $12.92 million.
Annual Gift Tax Exclusion:
The amount that can be given to each person you want without using any Applicable Exclusion. The Annual Gift Tax Exclusion is currently $17,000.
Generation-Skipping Tax Exemption:
This allows for giving to people who are grandchildren or other “skip persons.” It may also be used as a sophisticated way of avoiding Federal estate tax at the death of a child. Each person currently has $12.92 million of Generation-Skipping Tax Exemption.
STATE
New York State Estate Tax:
- New York Estate Tax Exemption Amount. New York’s exemption from estate tax increased from $5,930,000 to $6,020,000 for 2022. The exemption does not apply, however, to estates worth more than 105% of the New York exemption, meaning the entire estate is subject to the tax.
- Portability. New York does not provide for portability of a deceased spouse’s unused estate tax exemption.
- Gift Tax. New York has no gift tax, but currently does include gifts made within three years of death in the estates of New York resident decedents who die on or between January 16, 2019, and December 31, 2025.
- New Jersey Gift, Estate, and Inheritance Tax. New Jersey’s estate tax was repealed for decedents dying on or after January 1, 2018. New Jersey does not have a gift tax, but it does impose an inheritance tax on transfers to collateral relatives, including siblings, nieces, nephews, and unrelated individuals.
- Connecticut Gift and Estate Tax. Applicability of Connecticut’s estate and gift tax applies to aggregate gifts exceeding $9,100,000, with a top tax rate of 12 percent for 2022. In 2023, the exemption will match the federal exemption.
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