Individual, Corporate and Estate/Trust tax rates change yearly. The
attached tax tables will help you determine your current tax liability
and help you and your business plan for tomorrow.

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Tax Tables

Estates and Gifts

Latest Estate Tax Rates--2016

The 2016 estate and gift tax limits today, and the federal estate tax exemption rises to $5.45 million per person, and the annual gift exclusion amount stays at $14,000. These numbers, adjusted annually for inflation, matter to wealthy folks who are trying to whittle down their estates by making gifts to family members. It’s an annual exercise, done at year-end or the first of the year, depending on the family. Here are the numbers to talk about this holiday season.

The federal estate tax exemption—that’s the amount an individual can leave to heirs without having to pay federal estate tax—will be $5.45 million in 2016, up from $5.43 million for 2015. That’s another $20,000 that can be passed on tax-free. The top federal estate tax rate is 39.6%.

Latest Gift Tax Rates--2016

The gift tax is tied to the estate tax, so the inflation indexing helps the wealthy make the most of tax-free lifetime giving too. You can make the gifts during your lifetime; just you have to keep track of them as they count against the eventual estate tax exemption amount. In other words, you can’t double dip. So a woman who set up a trust for her kids with $5 million a few years ago could make new gifts to add to the trust and bring it up to the $5.45 million amount. A husband and wife each get their own exemption. So a couple will be able to give away $10.90 million tax-free in 2016 (assuming they haven’t made prior lifetime gifts).

Totally separate from the lifetime gift exemption amount is the annual gift tax exclusion amount. It’s $14,000 for 2016, the same as 2015. You can give away $14,000 to as many individuals as you’d like. A husband and wife can each make $14,000 gifts to the same person. So a couple could make $14,000 gifts to each of their four grandchildren, for a total of $112,000. The annual exclusion gifts don’t count towards the lifetime gift exemption.