The American Taxpayer Relief Act of 2012 permanently extended the federal estate,gift, and generation skipping tax exemptions to $5 million per person. This exemption is indexed for inflation which provides for a 2014 exemption of $5,340,000. The top federal estate tax rate remains at 40% for 2014. What this means for most estates (where the decedent dies in 2014) is that the first $5,340,000 of the estate is exempt from federal estate tax.
The federal annual exclusion rate for gifts stays at $14,000 for 2014 (gifts over 14k to a specific individual eat into the lifetime exemption of $5,340,000 but a person can give as many $14,000 gifts to different people as desired but any gift over $14,000 to one individual in a calendar year eats into the lifetime exemption). New York uses a State estate tax exemption of $1,000,000 and New Jersey uses an exemption of $675,000. There is no New York or New Jersey gift tax.
The annual exclusion for gifts to non-citizen spouses increased from $143,000 (2013) to $145,000 in 2014. The foreign earned income exclusion amount increases to $99,200 in 2014 (from $97,600 in 2013).
