Unofficial Inflation Adjustments for 2024

With the release of the Chained Consumer Price Index (C-CPI-U) for August 2023, it’s possible to calculate various inflation adjustments for 2024. The following are the significant federal estate planning numbers, with the numbers for 2023 shown in parentheses:

  • The federal estate tax base applicable exclusion amount (and generation-skipping tax exemption) will be $13,610,000 (was $12,920,000 for 2023).
  • The annual gift tax exclusion will be $18,000 (was $17,000).
  • The annual gift tax exclusion for a non-citizen spouse will be $185,000 (was $175,000).
  • The “2 percent” amount for purposes of section 6166 will be $1,850,000 (was $1,750,000).
  • The limitation on the special use valuation reduction under section 2032A will be $1,380,000 (was $1,310,000).
  • The top (37%) income tax bracket for estates and trusts will begin at $15,200 (was $14,450), and the maximum rate on capital gains will begin at $15,450 (was $14,650).
  • The alternative minimum tax exemption for estates and trusts will be $29,900 (was $28,400), and the phaseout of the exemption will start at $99,650 (was $94,600).

The Internal Revenue Service will publish the official inflation adjustments in a Revenue Procedure that will probably appear in 4-8 weeks.

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