Recently the IRS released Revenue Procedure 2013-35, which notifies practitioners and taxpayers of the inflation-adjusted numbers for 2014. Below, please review a synopsis of the estate planning numbers included in that agency document. These numbers become effective on January 1, 2014.
IRC § 2010 – Unified Credit Against Estate Tax. If a decedent dies in 2014, his or her estate may claim an inflation adjusted exclusion of $5,340,000 to determine the unified credit to apply against estate tax. This number adjusted upward from $5,250,000 in 2013.
IRC §2032A – Valuation of Qualified Real Property in Decedent’s Gross Estate. If a decedent dies in 2014, a personal representative (“PR”) may elect special use valuation. This election allows the PR to value the qualified real property as the family uses it as opposed to its fair market value, or highest and best use as intended by Congress. The total decrease in value based on the election must not exceed $1,090,000.
IRC §2503 and IRC §2523(i)(2) – Annual Exclusions for Gifts. A donor may make gifts to any donee in the calendar year 2014 up to $14,000 without paying gift tax on the amount. In fact, the amount will not fall within the definition of “taxable gifts” for tax year 2014. For a spouse who is not a United States citizen, a donor spouse may gift $145,000 to that spouse to the same effect as above.
IRC §6039F – Notice of Large Gifts Received from Foreign Persons. The Treasury Department and the IRS can require donees of gifts from certain foreign individuals to report such gifts. This requirements begins of the aggregate value of the gifts for the taxable years beginning in 2014 exceeds $ 15,358.
IRC § 6166 – Interest on a Certain Portion of the Estate Tax Payable in Installments. If an individual dies in tax year 2014, the personal representative will use $1,450,000 as the amount to determine the “2-percent portion” of the estate tax for the extended payments as provided in § 6166.
As a Denver estate planning attorneys Mr. McGuire is excited to work with you during the final part of 2013 and during the following tax years to come.
Contact The McGuire Law Firm to discuss your estate planning needs and schedule a free consultation!