Estate Lawyer Lackawanna County, PA
A Lackawanna County, PA estate lawyer understands that clients want to do all the can to ensure that every exemption available to them is used when preparing their estate plan. After all, you want your assets to go to your beneficiaries, not to the government. One beneficial tool that can help is the annual gift tax exemption. These exemptions can be used for gifts to family, friends, and even charities and are especially popular around the holiday season. The following is a brief overview of gift tax exemptions. For more detailed information about your situation, contact Hoegen & Associates, P.C. to find out how we can help.
How Important Are Exemptions to Estate Planning?
When a person dies, an inventory of all of their assets is conducted, along with the valuation of these assets. One reason this is done is to determine if there are any federal or state taxes that may be owed. If there are no exemptions, then there is a high likelihood that the tax burdens owed by the estate could have a significant impact on its final value, cutting into how much the decedent’s beneficiaries will receive. Unfortunately, there have been many situations where estates high net-worth estates are wiped out because of poor estate planning.
Using annual gift tax exemptions can help mitigate this expensive issue and could even result in a larger inheritance for beneficiaries. In some cases, working with a skilled Lackawanna County estate lawyer may even reduce the final tax debt completely using the gift tax exemption planning, along with other estate planning options.
Utilizing the Annual Gift Tax Exemption
To reduce their federal tax obligations upon death, taxpayers may transfer up to $12.06 million in their lifetime. This is the figure for 2022. In 2023, that lifetime amount increases to $12.92 million. This exemption doubles for married couples.
There is a per-person limit each year that can be given away. This year (2022), that amount of tax-free gift-giving is set at $16,000. In 2023, that figure will increase to $17,000. Again, the amount of the exemption is doubled for married couples.
Once you have reached the lifetime limit on the gift tax exemption, your estate will not be allowed any additional tax benefits, however, working with an attorney and planning out how these gifts are given should provide the most benefits to your estate.
Contact an Estate Lawyer for More Information
If you would like to find out how the gift tax exemption could help alleviate the tax burden on your estate, call Hoegen & Associates, P.C. to schedule a free consultation with a skilled Lackawanna County estate lawyer. There are many other types of estate planning tools that may also be available for your situation. Our lawyers can evaluate your estate and offer legal advice on the types of options that would be most beneficial for your situation and provide the most financial protection for your family’s future.