Based on the inflation measure provided by the Tax Cuts and Jobs Act and Consumer Price Index for the 12-month period ending August 31, 2019, Thompson Reuters Checkpoint has released their projected inflation-adjusted Estate, Gift, GST tax, and other exclusion amounts for 2020, as follows:
The unified estate and gift tax exclusion amount (gift and estate tax exemptions) for gifts made and decedents dying in 2020 will be $11,580,000 (up from $11,400,000 in 2019).
The generation-skipping transfer (GST) tax exemption for transfers made in 2020 will be $11,580,000 (up from $11,400,000 in 2019).
The gift tax annual exclusion amount for gifts made in 2020 will be $15,000 (the same amount as for gifts made in 2019 and 2018).
The annual exclusion for gifts to noncitizen spouses in 2020 will be $157,000 (up from $155,000 in 2019).
The special use valuation reduction limit for estate of decedents dying in 2020 will be $1,180,000 (up from $1,160,000 for 2019).
The portion of the estate tax that may be deferred on farm or closely-held businesses at an interest rate of 2% per year, after the applicable exclusion amount is applied, will be $1,570,000 (up from $1,550,000 for 2019).
The foreign gift reporting threshold for gifts from a nonresident alien or foreign estate to a U.S. person (other than an exempt Code Section 501(c) organization) will be $100,000; the foreign gift reporting threshold for gifts from foreign corporations and foreign partnerships to a U.S. person (other than an exempt Code Section 501(c) organization) will be $16,649 in 2020 (up from $16,388 for 2019).
The threshold in 2020 for an individual to be deemed a “covered expatriate” is an “average annual net income tax” of more than $171,000 (up from $168,000) for the five tax years ending before the date that the individual ceases to be a U.S. citizen or lawful permanent resident (i.e. green card holder).
The exclusion amount for the gross income of an individual for the mark-to-market deemed sale rules (which deem all of the property of an expatriate to be sold on the day before expatriation for its fair market value) will be $699,000 (up from $693,000 in 2019).
The foreign earned income exclusion amount in 2020 will be $107,600 (up from $105,900 in 2019).
Additional information on these and other projected tax related inflation-adjusted figures for 2020 can be found in the 2020 Inflation-Adjusted Figures Report available here.