We want to bring your attention to an important update in estate and gift tax laws that may impact you in the near future. The federal lifetime gift and estate tax exemptions, which currently allow individuals to shield up to $13.61 million and couples up to $27.22 million from estate tax, are set to expire by January 1, 2026, unless Congress takes action to make them permanent.
If these exemptions expire, they will be reduced by half, reverting to 2017 levels adjusted for inflation. This means individuals would be able to protect approximately $7 million and married couples around $14 million from estate tax. Estates exceeding these thresholds could face a tax rate as high as 40%, potentially resulting in substantial tax liabilities.
To safeguard your estate and minimize financial risks, we strongly advise revisiting your estate plan with your tax advisor. By proactively reviewing estate planning strategies now, you can take advantage of the current higher tax exemptions before they potentially decrease.
At the Kaminski Law Group, we understand the complexities of estate planning. Our dedicated team is here to assist you in navigating these changes with confidence and clarity, collaborating closely with your legal and tax advisors to ensure your estate is protected effectively.
