Increases to Gift and Estate Tax Exclusions in 2018

The IRS announced increases to the annual gift tax exclusion, and the U.S. estate tax, gift tax, and generation-skipping transfer tax exemptions for 2018. The increases provide high net worth families favorable opportunities for tax-efficient transfers of wealth to their children and other descendants. In addition, the annual gifting can be a simple and effective tool for reducing the size of one’s estate without incurring any gift or estate tax, or reducing one’s estate and gift tax exemption amount. In particular, if the tax reform bill becomes law, high net worth families should look to maximize the use of the additional exclusions amounts while they last.