The IRS has announced the estate and gift tax exemption amounts for 2017.
The lifetime exemption amount for estate and gift taxes is $5.49 million per individual. That is an increase from $5.45 million per individual in 2016. This means that an individual can leave $5.49 million to heirs and pay no federal estate or gift tax. The State of Michigan does not impose any estate or gift taxes.
A married couple can combine their individual exemptions for a total of $10.98 million, however, doing so is not automatic. You must transfer the first spouse's unused exemption to the surviving spouse by filing an estate tax return for the first spouse, even if no estate tax due.
The annual gift tax exemption amount for 2017 is $14,000 and has been that amount since 2014. This is totally separate from the lifetime exemption amount. An individual can give $14,000 to as many individuals as they like in 2017. These annual gifts do not count towards the lifetime exemption amount.
For more information, contact Estate Planning attorney, Jeffrey M. Black, at (616) 458-3994 or email firstname.lastname@example.org.