Lund & Guttry LLP

36917 Cook Street Suite 102, Palm Desert, CA 92211

 

Phone:  760-568-2242

Fax:      760-346-8891

  

Website: www.lundandguttry.com

July 2019

No Gift Clawback

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The IRS and Treasury Department issued proposed regulations that would ensure no clawback of large gifts if the federal estate tax exemption reverts back to 2017 levels. This would occur if Congress doesn’t make the current inflation-adjusted level permanent before its scheduled reversion in 2026.


Fears Calmed
The basic exclusion amount, which the new tax law doubled in 2017, was among the many provisions not made permanent, so taxpayers were concerned that their heirs would be on the hook for the difference if the tax provision reverted back to 2017 levels.


Exclusion Doubled
The new tax law increased the threshold for individuals from $5 million to $10 million for tax years 2018 through 2025, indexed to inflation. The inflation-adjusted threshold is $11.4 million in 2019. If you have concerns about estate taxes, see a tax pro.


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