Publications
Client Advisory for Tax Relief, Unemployment Insurance Reauthorization,and Job Creation Act of 2010 (the “Act”)
December 2010
Publications
Client Advisory for Tax Relief, Unemployment Insurance Reauthorization,and Job Creation Act of 2010 (the “Act”)
December 2010
On December 17, 2010, President Obama signed the Act. The Act greatly liberalizes the gift, estate, and generation-skipping transfer tax laws that apply through December 31, 2012. Changes that will have the greatest impact on estate planning include the following:
- The amount exempt from federal gift tax is $5,000,000 (in addition to $13,000 per year per recipient and direct payment of tuition and medical expenses).
- The amount exempt from federal estate tax is $5,000,000.
- With respect to a married couple, when the first spouse dies, if the $5,000,000 exemption from federal estate tax is not fully used, then the unused portion carries over to the spouse that has survived (referred to as “portability”).
- The amount exempt from the federal generation-skipping transfer tax is $5,000,000.
- The tax rate on taxable gifts and on taxable estates is 35% of the value of the assets subject to the tax.
