FEDERAL
Estate and Gift Tax Applicable Exclusion:
The amount that can be passed free of federal tax. Whatever amount is used during lifetime is no longer available for use to pass assets at death. The Estate and Gift Tax Applicable Exclusion is currently $12.06 million.
Annual Gift Tax Exclusion:
The amount that can be given to each person you want without using any Applicable Exclusion. The Annual Gift Tax Exclusion is currently $16,000.
Generation-Skipping Tax Exemption:
This allows for giving to people who are grandchildren or other “skip persons.” It may also be used as a sophisticated way of avoiding Federal estate tax at the death of a child. Each person currently has $12.06 million of Generation-Skipping Tax Exemption.
STATE
State Estate Tax:
In addition to the Federal Estate Tax, many states have a State Estate or Inheritance Tax. State Estate and Inheritance Tax may apply at a lower level than the federal tax. It may apply when a person dies when a resident in, or when one owns property in any of the many states with such a tax. Texas currently doesn’t have a state estate tax, but Slaton Schauer Law, PLLC still includes these protections in the estate plans we create. We know that many clients may purchase or inherit property from other states. Additionally, clients may move closer to grandchildren in other states, or need to care for elderly parents, or may move to other states for a variety of other reasons. We always provide the maximum protection we can to our clients and protect them from every situation we can reasonably anticipate.