IRS Announces 2024 Tax Adjustments: What You Need to Know for Your Estate Planning
On November 9, 2023, the Internal Revenue Service (IRS) took a crucial step in keeping pace with the relentless march of inflation by issuing Revenue Procedure 2023-34. This directive provides the annual inflation adjustments for various tax provisions, offering valuable insights for individual taxpayers planning their financial strategies for the upcoming tax year. In this article we discuss the key highlights of these adjustments and their implications for estate planning in 2024. Estate, Gift, and Generation-Skipping Transfer Tax Exemption One of the headline changes is the adjustment to the estate, gift, and generation-skipping transfer tax exemption amount for the year 2024. The new figure stands at $13,610,000, representing a significant increase from the previous year’s $12,920,000. This adjustment has crucial implications for individuals planning the transfer of assets, as it means they can now shield an additional $690,000 ($1,380,000 for married couples) from transfer tax liability compared to 2023. Annual Exclusion for Gifts The IRS has raised the annual exclusion for gifts in the calendar year 2024 to $18,000. This is an increase from the 2023 exclusion amount of $17,000. Gifts to Non-Citizen Spouses Another noteworthy adjustment involves gifts to spouses who are not citizens of the United States.
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