How much can you gift another without paying taxes?

Every year I attend the Notre Dame Estate Planning Institute. At this seminar, I receive a number of pieces of insight into what various limits will be for estate planning in 2024 after considering inflation, as well as information on a number of other estate planning matters.

The following are the items that were discussed at this year’s recent seminar. These numbers are considered estimates until the IRS confirms them:

• The 2024 gifting annual exclusion is estimated to be $18,000 per person per year. That number is an increase on the 2023 gifting annual exclusion amount which is currently $17,000 per person per year. This means that you can gift someone $18,000 in 2024 without there being any gift tax implications.
• The 2024 gift and estate tax exemption is estimated to be $13,610,000. That number has increased from the 2023 gift and estate tax exemption of $12,920,000. This means that you can gift more than $13.6 million of assets to someone without there being any gift tax implications. In addition, if you pass away in 2024 without having used any of this exemption, there will not be any estate taxes for your family to pay as well. This gift and estate tax exemption is scheduled to be reduced in 2026. That reduced amount is estimated to be between $6 million and $6,500,000. During the Trump presidency, the gift and estate tax exemptions were increased to $10 million and have increased due to inflation. However, there were not enough votes in Congress to make this gift and estate tax exemption increase permanent. Thus, the reason for the above reduction in 2026. Therefore, if your assets may exceed those numbers, you should consider contacting your estate planning attorney to discuss various options which could potentially save your family significant estate taxes in the future.
• For 2024 and currently there is not a limit on the amount of assets you can gift to a spouse who is a U.S. citizen. The 2023 limit on the amount you can gift to a spouse who is not a U.S. citizen is $175,000. The 2024 limit on the amount that you can gift to a spouse who is not a U.S. citizen is estimated to be $185,000.
• Since the interest rates are significantly higher now than they were in the last few years, you may also want to consider various estate planning techniques such as a qualified personal residence trust or a charitable trust if those estate planning techniques meet your estate planning wishes. These are estate planning techniques which can help save your family estate taxes in the future.

  
  NOTE: This general summary of the law should not be used to solve individual problems since slight changes in the fact situation may require a material variance in the applicable legal advice.

  James F. Contini II, Esq.
  Certified Specialist in Estate Planning,
  Trust & Probate Law by the OSBA
  Krugliak, Wilkins, Griffiths & Dougherty Co., LPA
  405 Chauncey Avenue NW
  New Philadelphia, Ohio 44663
  Phone: (330) 364-3472
  Fax: (330) 602-3187
  Email:  jcontini@kwgd.com