Federal Estate Tax Exemption for 2017: $5.49 Million

Unless your estate is worth many millions of dollars, you do not need to worry about the federal estate tax.

While the fate of the estate tax and many other taxes are likely to change for future years, the tax rules for 2017 are clear and set.

Federal Estate Tax Exemption -- $5.49 million.

Unless your taxable estate is worth more than $5.49 million, your estate will not owe federal estate tax if you die in 2017. (For the last several years, this exemption has slowly risen with inflation, from $5.0 million in 2010.) Further, portability continues to greatly increase the the power of this exemption for married couples who can now leave up to $10.98 without paying estate tax.

Learn more about estate tax and portability.

In the handful of states that have linked their estate taxes to the federal exemption, the state exemption also rises to $5.49 million.

Learn more about state estate taxes.

Personal Gift Tax Exemption

Still $14,000, per recipient per year. Unchanged since 2013.

Learn more about gift tax.

Non-Citizen Spouse Exemption

Now $149,000, up from $148,000 in 2016.

Learn more about estate planning with a non-citizen spouse.

Kiddie Tax Exemption

On a child's unearned income:

  • no tax on the first $1,050

  • child's tax rate on the next $1,050, and
  • parent's highest tax rate on any amount over $2,100.

This tax applies to the unearned income of children under age 19, and a young people under age 24 who are full-time students and whose earned income is less than half of the amount required for their support.

These numbers were the same for 2015 and 2016.

Learn more about the kiddie tax.

Read On If You Like Tax Info!

You can read the entire IRS report on inflation-adjusted numbers for 2016: IRS Bulletin 2016-45

Effective date: Jan 01, 2017