On November 26, the IRS released final anti-clawback regulations regarding the temporarily doubled estate and gift tax exclusions ($11 million/$22 million) in the Tax Cuts and Jobs Act (TCJA) that will revert to pre-TCJA levels on January 1, 2026.
The IRS made clear that if a taxpayer uses up the full temporarily-doubled exemption, but dies in a year when the exemption is lower, there will be no penalty—any gift amounts covered by the temporary exemption will not be clawed back into the estate.
The exclusion available at death will be either:
Reflecting the clear intent of the TCJA, the final guidance is good news for clients engaged in planning under current exemption levels.
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