By: Melanie E. Cuddyre, Esq.
On October 18, 2022, the Internal Revenue Service (the “IRS”) issued Rev. Proc. 2022-38, which set forth, in relevant part, the 2023 estate and gift tax exclusion amount. These amounts are adjusted for inflation on an annual basis. The exclusion amounts have increased from $12.06 million in 2022 to $12.92 million per person in 2023. With proper planning or use of portability, this means that a married couple has a combined exclusion amount of $25.84 million.
The estate and gift tax rate remains the same in 2023 at a rate of 40%, and the gift tax annual exclusion has increased from $16,000 per person to $17,000 per person. Gifts of a present interest up to $17,000 can be made to as many people as the donor chooses without reducing the donor’s $12.92 million lifetime exclusion amount.
While the exclusion amount is slated to be drastically reduced on January 1, 2026, and may be reduced before then through proposed tax reform, individuals should consider taking advantage of lifetime gifting strategies now to lessen, or even eliminate, their federal estate and gift tax liability.
If you have any questions regarding estate and gift tax matters, or lifetime gifting strategies, please contact Melanie E. Cuddyre, an Attorney in Leech Tishman’s Estates & Trusts Practice Group in the firm’s Pittsburgh, PA office. Melanie can be reached at 412.261.1600 or firstname.lastname@example.org.
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Leech Tishman Fuscaldo & Lampl is a full-service law firm dedicated to assisting individuals, businesses, and institutions. Leech Tishman offers legal services in business restructuring & insolvency, construction, corporate matters, employment & labor, estates & trusts, intellectual property, litigation & alternative dispute resolution, and real estate. In addition, the firm offers a wide range of legal services to clients in the aviation & aerospace, cannabis, emerging cyber technologies, energy & natural resources, healthcare, and hospitality industries. Headquartered in Pittsburgh, PA, Leech Tishman also has offices in Chicago, Los Angeles, New York, Philadelphia, Sarasota, and Washington, D.C.