Alerts & Updates
he Massachusetts constitution requires that the income tax must be a flat tax. On November 8, 2022, voters in Massachusetts approved a constitutional amendment for the first time in 22 years which imposes a 4% surtax on top of the state’s 5% flat tax for the portion of the annual household income exceeding $1,000,000. The $1,000,000 threshold will be adjusted annually to reflect cost-of-living increases.
On October 18, 2022, the IRS officially announced the inflation adjustments for 2023 for the gift and estate tax exemptions.
In November of 2019, the IRS issued final regulations referred to as the “Anti-Clawback” regulations that made it clear that a taxpayer who took advantage of the higher gift tax exemptions (currently, $12,060,000) available under the 2017 Tax Cuts and Jobs Act would not owe additional estate tax upon death if the exemption is lower at the time of death. The regulation was needed since the estate tax calculation includes lifetime taxable gifts. Otherwise, a taxpayer who made a large gift now may not pay gift tax but the estate would pay estate tax upon the taxpayer’s death if the exemption was lower at that time.
The Biden Administration's Revenue Proposals Again Include Changes to the Estate and Gift Tax SystemMarch 30, 2022
On March 28, 2022, the Biden Administration released its “General Explanation of the Administration’s Fiscal Year 2023 Revenue Proposals.” The document again supports several drastic changes to the estate and gift tax system in addition to changes to the income tax system.
On December 22, 2021, New York joined 39 other states (including Florida) to make remote notarizations permanently legal.
The Department of the Treasury Issues Proposed Regulations Implementing the Corporate Transparency ActFebruary 3, 2022
In December 2021, the Financial Crimes Enforcement Network (FinCEN) of the Department of the Treasury issued proposed regulations implementing certain beneficial ownership reporting requirements of the Corporate Transparency Act of 2020.
In Revenue Procedure 2021-45, the IRS announced its inflation adjustments to key figures for the calendar year 2022. For the first time in several years, the annual exclusion from gift tax will increase from $15,000 to $16,000 per year per donee effective January 1. 2022.
This annual update summarizes the current status of the estate and gift tax rates and exemptions at the federal and state levels (Connecticut, New York and Florida) and highlights key provisions of these important state law developments.
Governor Cuomo and New York legislators recently announced an agreement on New York’s budget that includes a significant increase for the income tax rates that will be charged against New Yorkers with high levels of income. The bill is expected to pass.
With the recent passage of the American Rescue Plan, President Biden’s $1.9 trillion stimulus package, it is natural to consider what kind of revenue generating legislation may be coming in the next months and years in order to pay for what has now been three separate rounds of stimulus bills to address the challenging economic conditions brought on by the Covid-19 pandemic.
What will happen to estate, gift and generation-skipping transfer tax exemptions in 2021 and beyond?January 21, 2021
With the inauguration of President Joe Biden and a congress narrowly controlled by the Democratic party, many clients and estate planners have begun to worry about what, if anything, will happen to the federal estate, gift and generation-skipping transfer (“GST”) tax exemptions and rates in 2021 and beyond.