James F. McDonough
Of Counsel
732-568-8360 jmcdonough@sh-law.comKey Contacts
Back
The federal gift tax limit will remain the same this year as it was last year, according to the IRS.
As a result, a taxpayer (donor) may gift as much as $14,000 to each recipient (donee) without being required to file a gift tax return or paying gift taxes on these amounts. In addition, married couples can provide as much as $28,000 to a donee in gifts each year without generating gift tax liability on such transactions.
The federal estate tax, which is tied to the federal gift tax limit, also saw its exemption move higher in 2015 – rising to $5.43 million compared to $5.34 million in 2014.
For married couples, the amount is $10.86 million. If a taxpayer makes gifts, he or she will need to keep records of these donations because the total amount given is counted toward the federal estate tax amount.
Exemption from the generation-skipping transfer tax also increased this year, rising to $5.43 million from $5.34 million in 2014.
This particular levy involves transfers of wealth to grandchildren or other distant relatives made during their lifetime or death. Taxpayers should bear in mind that if they trigger the estate tax, gift tax or the generation-skipping transfer tax at the federal level, their tax rate could reach as much as 40 percent.
These higher exclusions of the federal estate and gift tax limit became locked in when Congress passed the American Taxpayer Relief Act of 2012.
This made certain tax cuts enacted in 2001 and 2003 permanent. Pursuant to legislation approved earlier in the previous decade, the federal gift tax exclusion was $11,000 in 2004 and 2005, $12,000 between 2006 and 2008, $13,000 for the years 2009-2012 and $14,000 from 2013 on.
Going forward, the gift tax limit exemption will track higher. Due to inflation, it will rise in increments of $1,000, according to The National Law Review.
- Practices: Tax, Trusts & Estates
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
Breach of Contract Explained: Types and Consequences
Breach of contract disputes are the most common type of business litigation. Therefore, nearly all New York and New Jersey businesses will likely have to deal with a contract dispute at least once. Understanding when to file a breach of contract lawsuit and how long you have to sue for breach of contract is essential […]
Author: Brittany P. Tarabour
How to Dissolve a Corporation in New Jersey: A Step-by-Step Guide
Closing your business can be a difficult and challenging task. For corporations, the process includes formal approval of the dissolution, winding up operations, resolving tax liabilities, and filing all required paperwork. Whether you need to understand how to dissolve a corporation in New York or New Jersey, it’s imperative to take all of the proper […]
Author: Christopher D. Warren
Gross Lease vs. Net Lease: Understanding the Key Differences
Commercial leases can take a variety of forms, which is often confusing for both landlords and tenants. Understanding the different types, especially the gross lease structure, is important when selecting the lease that best suits your needs. One key distinction between lease types is how rent is calculated and paid. This article addresses the two […]
Author: Robert L. Baker, Jr.
What to Do If You Are Impacted by a Retailer Bankruptcy Part 2
Over the past year, brick-and-mortar stores have closed their doors at a record pace. Fluctuating consumer preferences, the rise of online shopping platforms, and ongoing economic uncertainty continue to put pressure on the retail industry. When a retailer seeks bankruptcy protection, a myriad of other businesses are often impacted. Whether you are a supplier, customer, […]
Author: Brian D. Spector
The Current Administration's Proposals for the Financial Services and Banking Industries Will Affect Your Business
Since his inauguration two months ago, Donald Trump’s administration and the Congress it controls have indicated important upcoming policy changes. These changes will impact financial services policies and priorities. The changes will particularly affect cryptocurrency, as well as banking rules and regulations. Key Regulatory Changes in Cryptocurrency For example, in the burgeoning cryptocurrency business environment, […]
Author: Dan Brecher
Tips for Commercial Landlords Impacted by Wave of Retailer Bankruptcies Part 1
The retail sector has experienced a wave of bankruptcy filings over the last year. Brick-and-mortar businesses in financial distress include big-name brands like Big Lots, Party City, The Container Store, and Vitamin Shoppe. When large retailers seek bankruptcy protection, they are not the only businesses impacted. Landlords can be particularly hard hit. While commercial landlords […]
Author: Brian D. Spector
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.