Annual Gift Tax and Estate Tax Exclusions Are Increasing in 2022
The amount you can gift without filing a tax return is increasing to $16,000 in 2022, the first increase since 2018. The federal estate tax exclusion is also climbing to more than $12 million per individual.
Posted on December 24, 2021
The IRS’s announcement that the annual gift exclusion will rise for calendar year 2022 means that any person who gives away $16,000 or less to any one individual (anyone other than their spouse) does not have to report the gift or gifts to the IRS. Any person who gives away more than $16,000 to any one person is technically required to file Form 709, the gift tax return.
FREE WEBINAR
5 Things to Know About
Estate Planning
When You Turn Sixty-Five
The basic federal estate tax exclusion amount for the estates of decedents dying during calendar year 2022 will be $12,060,000 for individuals and $24,120,000 for couples, up from $11.7 million and $23.4 million for calendar year 2021. The increase in the estate tax exclusion means that the lifetime tax exclusion for gifts should also rise to $12,060,000, as should the generation-skipping transfer tax exemption.
This $12,060,000 million lifetime gift tax exclusion means that even if you are technically required to file Form 709 because you gave away more than $16,000 to any one person during the year, you will owe taxes only if you have given away more than a total of $12,060,000 million in the past. As a result, the filing of Form 709 is irrelevant for most people because the vast majority do not have $12,060,000 million to give away.
For details from the IRS on many of these and other inflation adjustments to tax benefits, go to: https://www.irs.gov/pub/irs-drop/rp-21-45.pdf
More from our blog…
Understanding Medicaid: What Does Medicaid Cover?
In the complex and frequently changing landscape of health care in the United States, Medicaid stands out as a vital program. Since 1965, it has [...]
Elder Financial Abuse: How an Elder Law Attorney Can Help
Elder financial abuse is a significant issue affecting many older adults nationwide. It involves someone exploiting or misusing an older person’s finances or assets for [...]
Does Medicare Cover Prescription Weight Loss Drugs?
Americans have a growing appetite for prescription drugs such as Ozempic, Wegovy, and Mounjaro. Originally developed to treat Type 2 diabetes, they are now exploding [...]
How Social Security Overpayment Rules Are Changing
With a new commissioner at the helm, the Social Security Administration (SSA) has been announcing several policy changes in recent weeks. In late March 2024, the [...]
Recent blog posts
FREE WEBINAR
5 Things to Know About
Estate Planning
When You Turn Sixty-Five