In 2012 Congress passed the American Taxpayer Relief Act (ATRA). ATRA did a variety of things including making permanent the $5 million estate, gift, and generation-skipping (GST) tax exemptions, as increased for inflation. The table below sets out the new rates for tax exemptions for 2014.
Tax Exemption Inflation Increases for 2014
- In 2014, the annual gift tax exclusion has not increased from 2013 and stays at $14,000.
- In 2014, there is 40% top federal estate tax rate on estates larger than $5,340,000 which is an increase from 2013 ($5,250,000).
- In 2014, there is a 40% top federal GST tax rate, and there is a $5,340,000 GST tax exemption up from 2013 ($5,250,000).
- In 2014, there is a 40% top federal gift tax rate, and the lifetime gift tax exemption is $5,340,000 increased from 2013 ($5,250,000).