In February 2012, the President released his federal budget proposals for fiscal year 2013. The revenue proposals include over 130 proposed tax changes for businesses and individuals, including estate and gift tax changes.
The budget's proposals relating to estate and gift tax include the following.
Restoration of transfer tax to 2009 levels. The estate and gift tax parameters as they applied during 2009 would be made permanent. The top tax rate would be 45% and the exclusion amount would be $3.5 million for estate taxes, and $1 million for gift taxes. These changes would apply after December 31, 2012.
Portable estate tax exclusion made permanent. The provision allowing a surviving spouse to use the deceased spouse's unused estate tax exclusion, which expires after December 31, 2012, would be made permanent.
Contact Alan Ehrlich at (973) 862-8905 to discuss how these changes would affect your individual estate tax planning.