Estate Planning After Tax Reform

May 2018

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Tax reform has created new planning opportunities for Private Client Services. Every high-net worth family needs to consider how the changes to the estate and gift tax exemptions impact their planning.
  • Doubled Estate and Gift Exemption: Tax reform increased the applicable estate and gift exemption for individual taxpayers to $11,180,000 ($22,360,000 for married couples) starting in tax year 2018. This amount will be adjusted for inflation each year.
  • Doubled GST Exemption: Tax reform also doubled the generation-skipping transfer (GST) tax exemption amount to $11,180,000 ($22,360,000 for married couples) starting in tax year 2018. This amount will be adjusted for inflation each year.
  • New Measure for Inflation: Following tax reform, inflation will be measured using the Chained-Consumer Price Index. Chained-CPI is a lower rate of inflation. Chained-CPI is estimated once in February and is finalized the following February.
These increased exemptions are set to expire on December 31, 2025, and therefore every individual should review their estate plan and evaluate how the changes impact their goals. Key estate planning considerations include:
  • Additional Gifting Capacity
  • Allocating GST Exemption
  • Powers of Appointment
  • Credit Shelter Trusts
  • QTIP Trusts
  • Spousal Limited Access Trusts
To learn about these estate planning opportunities and for more tax reform resources: