Monthly Archives: March 2012

Chart of current and historical estate tax exemptions, gift tax exemptions, and GST exemptions

 

 

 

 

 

 

  2010

2011

2012

2013

Estate Tax

Exemption amount *

$5.0 million

*

$5.0 million

*

$5,120,000

*

$1.0 million

*See note below **

Tax rate

Flat (35%)

Flat (35%)

Flat (35%)

Progressive (up to 55%)

Elections

Can elect out of estate tax, but §1022 carryover basis will apply ($1.3 million “free-basis” + $3.0 million spousal bonus)

Can elect to add “deceased spousal unused exclusion amount” (basically, the unused exemption from the estate of the decedent s last deceased spouse or the exemption amount in effect at the decedent s death, whichever is less) to the exemption amount

Can elect to add “deceased spousal unused exclusion amount” (basically, the unused exemption from the estate of the decedent s last deceased spouse or the exemption amount in effect at the decedent s death, whichever is less) to the exemption amount

None

** Note that President Obama’s approved  a $5 million dollar exemption, while all Republican presidential candidates favor repeal of estate tax.

Gift Tax

Exemption amount

$1.0 million

$5.0 million (plus, if elected, the “deceased spousal unused exclusion amount”)

$5,120,000 (plus, if elected, the “deceased spousal unused exclusion amount”)

$1.0 million

See note above.

Tax rate

Flat (35%)

Flat (35%)

Flat (35%)

Progressive (up to 55%)

Generation-Skipping Transfer Tax

Exemption amount

$5.0 million

$5.0 million

$5,120,000

$1.0 million

See note above.

(indexed from 1997)

Tax rate

Zero

Flat (35%)

Flat (35%)

Progressive (up to 55%)

* Note the evolution of estate tax exemption amounts: $161,000 in 1980; $225,000 in 1982; $275,000 in 1983; $325,000 in 1984; $400,000 in 1985; $500,000 in 1986; $600,000 from 1987 – 1997; $625,000 in 1998; $650,000 in 1999; $675,000 in 2000-2001; $1,000,000 in 2002-2003; $1,500,000 in 2004-2005; $2,000,000 in 2006-2008; $3,500,000 in 2009; $5,000,000 in 2010-2011.

©JAMES J. PHILLIPS, P.C. March 19, 2012