IRS Confirms No Clawback for Lifetime Exemption Gifts
Are you taking advantage of the increased gift and estate tax exclusions? If not, it might be a good idea to take a look at using the higher exemption that is in place today.
The 2017 Tax Cuts and Jobs Act, in essence, doubled the lifetime exemption for estate and gift taxes. For example, the 2019 federal exemption is $11.4 million per person or $22.8 million for a married couple. These amounts will revert back to about half these amounts in 2026. There has been concern that making large gifts now may result in estate tax being owed at death. A recently released proposed regulation by the IRS has confirmed that it will not retroactively “clawback” gifts made during this temporary increase in the exclusion amount.
Please note that MN decedents are still subject to a much lower MN estate tax exemption.
If you have questions about the above information, our Trusts & Estates attorneys can be reached by clicking their names (David Ness, Karen Schlotthauer, Matthew Jensen, or Nicole Flaherty) or by calling 952-995-9500.