IRS Announces 2021 Adjustments to Several Trust, Estate Items in Revenue Procedure 2020-45

Wed Nov 4, 2020 | Estate Planning |

The Internal Revenue Service recently released Revenue Procedure 2020-45 which applies to taxable years beginning in 2021. This announced the annual inflation adjustments for more than 60 tax provisions. A few of the major items related to trusts and estates include the following:

  1. The basic exclusion amount (which includes the gift and generation-skipping transfer tax exemption) for estates of decedents who pass away during 2021 is $11,700,000.00, which is an increase from the 2020 figure of $11,580,000.00.
  2. The annual exclusion for gifts is $15,000.00 for calendar year 2021, which remains unchanged from 2020.
  3. The annual gift tax exclusion for a non-citizen spouse is $159,000.00, which is an increase from the 2020 figure of $157,000.00.
  4. The top income tax bracket for estates and trusts will begin at $13,051.00, which is an increase from the 2020 figure of $12,950.00. This tax bracket is taxed at a rate of 37%.
  5. The alternative minimum tax exemption for estates and trusts will be $25,700.00, and the phaseout of the exemption will start at $86,650.00.

Have Questions? Speak to Our Boca Raton Estate Tax Attorney Today

Click here for the full Revenue Procedure and contact an estate tax attorney at Ellis Law Group for more information.

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