Will the Federal Estate Tax Affect Me in Pennsylvania?

Will the Federal Estate Tax Affect Me?

The Federal Estate Tax will affect you if your assets and investments total a certain amount when you pass away.  The tax, levied by the Federal Government, will be a percentage of the transfer of your estate at the time of your death. For 2017, the estate and gift tax exemption is $5.49 million per individual, up from $5.45 million in 2016 and should continue to inch up every year. That means an individual can leave $5.49 million to heirs and pay no federal estate or gift tax.  A married couple will be able to transfer about $11 million ($10.98 million) without paying any federal estate and gift taxes.  Using a relatively new tax planning tool called “portability,” a married couple can avoid expensive, complicated estate planning and still avoid paying any Federal Estate Tax.  A Portability election allows a decedent’s unused exclusion amount (deceased spousal unused exclusion amount, or DSUE amount) to become available for application to the surviving spouse’s subsequent transfers during life or at death.  The Federal Estate Tax is only on the assets in excess of the exemption amount, not on the whole amount.  However, many couples and individuals high net worths choose to use strategic planning during their lifetime to create an Estate Plan that will help them avoid paying any Federal Estate Tax.  As your attorneys, we can assist you in taking advantage of portability, re-titling property, gifting assets, and creating trusts that will minimize your exposure to the Federal Estate Tax.


The information within this site is not, nor is it intended to be, legal advice. You should consult an attorney for individual advice regarding your own particular situation.