We explained in last week's post here on our Las Vegas estate planning law blog that the federal estate tax exemption is going up to $5.43 million in 2015. We explained the importance of taking this into account in order to avoid a tax penalty on one's estate of as high as 40 percent, but our readers may be wondering just what one can do to avoid it. While a legal professional should be consulted for specific tax advice, following are some general tips.
We briefly discussed last week how annual gifts of under $14,000 are one way to reduce one's taxable estate. A married couple could each give $14,000 to the same child or grandchild and still avoid incurring gift tax penalties; that's $28,000 per year. And such gifts can be given to any number of recipients -- as long as no gift exceeds $14,000.