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Estate and Gift Tdx Rates for 2014By: Patricia C.Marcin, Esq. @ 2014

The total amount that each person can give away to people

other than spouses and charities, during life or at death (com-

bined), without having to pay federal gift or estate tax has

been increased to $5,340,000 beginning Jantary 1,2074,tpfrom $5,250,000 in 201,3. 'Ihat means that married couples

can give ^way

a total of $10,680,000 to children, grandchil-

dren and others without incurring any federal transfer taxes.

The gift tax annual exclusion amount remains at $14,000

($28,000 for married couples) per donee pet yeu. The top

federal gift and estate tax rates remain at 40o/o for 2014. New

York, however, is another story.

New York has its own separate estate tax system. It does not

impose gift tax on transfers made during a donor's life. The

14l NeighborhoodNews Lloyd Harbor Life FBnnuenv

total that each person can give aw^y to people other than spous-

es and charities without having to pay New York State estate

tax remains at $1 million for 2074. While the top NewYork

State estate tax rate remains at 1,60/o for 2074, it is important to

note that the New York State estate tax computation requires

two separate calculations and is based on the 1998 federal estate

tax exemption amount (ust $1 million). This can result in the

actual estate tax rate paid being higher than 1.60/o.

Since there is no New York State gtft tu,it is wise to consider

making gifts to reduce the assets left in your estate at your

death. But be cautious and consider the federal and New York

State capital gains tax consequences of making gifts, as the

donee takes the gifted assets with your income tax basis. The

following chart shows scenarios of the effects of lifetime giving

on New York State estate taxes;

Note that lifetime gifts totaling under $5,340,000 will result in

no federal gift tax, and there will be no federal estate tax if the

value of your lifetime gifts plus the value ofyour assets remain-

ing at your death totals under $5,340,000. Your advisor can dis-

cuss with you many estate planning techniques that can be con-

sidered to moderate income, gift and estate tax consequences.

If there is a trusts or estates topic that you would like to know

more about, please feel free to email me at $3t1ft.*r{*?t'S}favnelFfnlte"

csm with your suggestion. I will do my best to cover it in a

future column.

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NYS

55,000,000 5o s5,000,000 s391,600

ss,000,000 s1,000,000 s4,000,000 s280,000

s5,000,000 s2,s00,000 s2,s00,000 s 1 38,800

ss,000,000 54,000,000 s 1,000,000 s33,200

ss,000,000 54,5oo,ooo s s00,000 -0-

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FARRELLh"il!IT"H,,ii i. t:t;,:t:l

BECAUSE SUCCESS MATTERS,

132O BXB Plczo, Uniondole, NY 1'1556 132O

516.227.O /AO i www.forrellfritz.com

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