Rich? Make bigger gifts tax-free
Tax reform also boosted the lifetime gift and estate tax exemption from $5.49 million in 2017 to $11.18 million in 2018. That number affects those who pass away, but it also establishes the limit for taxable gifts made during one’s lifetime. Even those wealthy individuals who’ve routinely maxed out their lifetime taxable gifts can therefore make an additional $5.69 million in gifts in 2018 without having to pay any out-of-pocket tax thanks to the higher exemption. With the higher life time exemption set to go away after 2025, however, there’s at least some uncertainty about what will happen after that date for those who made large gifts.