Debt Super Committee Targets $5 Million Gift Tax Exemption for 2012
The 12-member Joint Select Committee on Deficit Reduction created by the Budget Control Act of 2011 has discussed possibly reducing or completely eliminating the current $5,000,000 exemption levels for the different transfer taxes (Estate, GST and Gift).
There have been some comments suggesting that the Gift Tax Exclusion may be reduced from $5M to $1M as of January 1, 2012, rather than letting it expire on December 31, 2012, as originally planned.
The actual content of the Super Committee meetings are not actually known, but some professionals even suggest that the reduction might be effective as early as November 23, 2011.
We have no way at all of knowing what law changes will actually pass, but, given this possibility, anyone planning to make gifts using the increased exemption amount may want to consider making gifts prior to the end of this year instead of in 2012.
If you have any other questions, please contact us at (415) 692-3900.
To ensure compliance with requirements imposed by the IRS, we inform you that any tax advice contained in this communication (including attachments) was not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.