Trusts Law – Federal Estate Tax Primer

The federal transfer tax system, consists of an integrated estate and gift tax system. Meaning that on a federal level an estate upon death is taxed at a rate of 45% for anything above the applicable exclusion. When the applicable exclusion is 5.43 million, an individual can die and the estate will not experience federal estate tax.

Susan L. Anderson focuses her practice on estate planning, trusts, wealth preservation, charitable planning, and probate; on the administration and litigation fronts. As the former CEO and President of ING National Trust, Susan has a deep view and understanding of a myriad of trusts.

In this CLE class video clip, Susan L. Anderson, Esq. discusses Trusts Law – Federal Estate Tax Primer.

You can watch the complete Trusts Law CLE class here:
Trusts Law CLE

However, this is a cumulative exemption. The amount you have gifted during your life is considered in the 5.43 million non-taxable figure. If you have gifted 2 million in your lifetime, then at your death only 3.43 million would be non-taxable. This tax is called an estate tax and is assessed against the estate before the proceeds are distributed to your heirs.

There is an additional exemption for 5.43 million, which is called the generation skipping applicable exclusion. This exclusion means you can gift in addition to the 5.43 million you can give anyone in your life, you can give 5.43 to any generation which
skips your children and goes to your grandchildren, or further removed generations.

The additional 5.43 million is portable, so that for a legally married couple, the 5.43 million is doubled to 10.86 million and does face a few requirements.