January 1, 2026, is an important date to remember. On that day the tax saving mechanisms from TCJA in 2017 revert to pre-2018 levels, including the federal estate tax lifetime exemption, unless Congress takes action. Currently, the lifetime exemption for federal estate tax is $13.61 million per person. The new lifetime exemption amount is projected to be reduced to $7M beginning on January 1, 2026. Granted, this is not something most Americans will need to concern themselves with, but if you a own a business, significant investable assets, or valuable real estate…..
Hello again, Judy Bernhard, CPA and Resident Tax Manager of Killingsworth Spencer CPAs. If you have not had a discussion with your parents recently about what they own (especially that tract of land nearly everyone in the family has forgotten about), this may be a good time to gather your thoughts and have a frank conversation this holiday season.
Thinking ahead on these matters is key. Let’s assume for a moment that your parents’ own assets below the current exemption amount but above the projected amount, and you are the beneficiary, and estate planning is out of date or not in place. You and your parents may miss a huge opportunity to save taxes that are up to 40% of any value over the lifetime exemption. Killingsworth Spencer CPAs prepare Estate and Trust Tax returns, including Forms 706 and 709 (gift tax returns), but it is the responsibility of an estate attorney to draw up the Will and Trust agreements.
Several estate attorneys we work closely with anticipate that clients must be in the queue by May or June next year to deal with this critical financial issue, or they may not get the work done by the sunset date of December 31, 2025.
If you have questions or concerns regarding this or any other tax matter, please give
me a call at 770-552-8286.
Disclaimer: This post is for general information only and should not be taken as legal or financial advice