IRS Announces 2016 Estate and Gift Tax Limits

By November 4, 2015December 21st, 2017Uncategorized

2016 Estate and Gift Tax Limits –

For 2016, the Internal Revenue Service has announced that the estate and gift tax exemption is $5.45 million per individual, up from $5.43 million in 2015. That means an individual can leave $5.45 million to heirs and pay no federal estate or2016-gift-tax-ornament_optomized-480x350 gift tax. A married couple will be able to shield $10.9 million from federal estate and gift taxes.

The annual gift exclusion for 2016 remains the same at $14,000.

Why is this important? Most people have a desire to pass as many assets as they can to their heirs. When deciding on your estate plan, knowledge as to what portion of your estate, if any, may be subject to estate taxation is critical in deciding on a plan.

My assets are below the 2016 threshold, should I still be worried? Maybe. Even though the you may be below the Federal level, you may be above the levels taxed by each state. For example, the State of Rhode Island has set a limit of $1,500,000 before an estate tax is due; Massachusetts is even worse being set at $1.0 million. Other states, such as Florida and New Hampshire do not impose any estate tax.

Still concerned and confused about estate taxes? Contact us for a free consultation.

MJL Blog Footnote

mm

About Matt Leonard

Matthew J. Leonard, Esq. has devoted his practice to handling the legal needs of individuals and their business interests through all stages of life. As an attorney with the law firm of Salter McGowan Sylvia & Leonard, Inc., he has been engaged to handle matters from basic to sophisticated involving Estate Planning, Elder Law, Medicaid Planning, Probate, Trust and Estate Administration, Real Estate, Business Transactions, Business Creation and related litigation.