I hope that everyone had a wonderful holiday season. Before I get into the recent updates on estate tax law changes, I would like to take a moment and thank our clients, referral partners and team for helping make 2021 our most successful year yet. Canarick & Canarick is a small firm that does not advertise its services. Our business stems from the relationships we have created with all of you. We do not take for granted the trust that you place in us, and we look forward to continuing to work with each of you for years to come. Also worth noting, we recently upgraded our website: Canarick & Canarick so please check it out if you get a chance.
The tax updates this year are very minor. Although it appeared on multiple occasions that there was going to be a major overhaul of the estate tax system, the only updates for me to share are the usual inflation adjustments that occur each year…
For an estate of any decedent dying during calendar year 2022, the applicable exclusion is increased from $11.70 million to $12.06 million. This change increases not only the applicable exclusion amount available at death, but also a taxpayer’s lifetime gift applicable exclusion amount and generation skipping transfer exclusion amount. For those of you who used your entire $11.70 million gifting applicable exclusion amount in 2021, you now have the ability to gift another $360,000 out of your estate. If no new tax law is passed, the increased exclusion amounts are scheduled to expire on December 31, 2025, which would mean a reduction in the exclusion amounts to $5 million (plus adjustments for inflation). Of course, we still could get a new tax law prior to that. I will continue to keep everyone updated if anything changes.
The estate, gift and generation skipping transfer tax rate remains the same at 40%.
The gift tax annual exclusion is increased from $15,000 per beneficiary to $16,000 per beneficiary.
The New York exclusion is increased to $6.11 million (up from $5.93 million in 2021).
The Connecticut estate and gift tax applicable exclusion amount is increased from $7.1 million to $9.1 million in 2022. This amount is scheduled to meet the Federal estate and gift tax exclusion amount in 2023.
New Jersey and Pennsylvania continue to have no estate tax, however, both states do have inheritance taxes. While the New Jersey Inheritance Tax only applies when assets pass to someone other than a spouse, parent, child, grandchild, etc., the Pennsylvania Inheritance Tax applies to all beneficiaries, other than spouses and minor children (i.e. children under the age of 21).
As always, please feel free to reach out with any questions or to schedule a review of your estate plan.
Wishing you and yours a safe, healthy, and prosperous new year!
2021-120013 Exp 04/22. This material is intended for general public use and is for educational purposes only. By providing this content, Park Avenue Securities LLC is not undertaking to provide any recommendations or investment advice regarding any specific account type, service, investment strategy or product to any specific individual or situation, or to otherwise act in any fiduciary or other capacity. Please contact a financial professional for guidance and information that is specific to your individual situation. Russell 2000 Index measures the performance of the smallest 2,000 companies in the Russell 3000 Index of the 3,000 largest U.S. companies in terms of market capitalization. Dow Jones Industrial Average is a widely used indicator of the overall condition of the stock market, a price-weighted average of 30 actively traded blue chip stocks, primarily industrials, but also includes financial, leisure and other service-oriented firms. Indices are unmanaged, and one cannot invest directly in an index. Past performance is not a guarantee of future results. All investments contain risk and may lose value. Investing in the bond market is subject to certain risks including market, interest rate, issuer, credit and inflation risk. Equities may decline in value due to both real and perceived general market, economic and industry conditions. 2021-119110 Exp 4/22. Source Bloomberg
This article was written by an independent third party. It is provided for informational and educational purposes only. The views and opinions expressed herein may not be those of Guardian Life Insurance Company of America (Guardian) or any of its subsidiaries or affiliates. Guardian does not verify and does not guarantee the accuracy or completeness of the information or opinions presented herein. 2021-127125 Exp 09/23
Jeremy has been in the financial advisory business since 2005 after graduating from Fordham University’s School of Business. He joined Tomoro as a managing partner in 2014. During his tenure, Jeremy has consistently excelled as an advisor in both the personal household and business planning arena. As a managing partner, Jeremy also serves as a mentor to all associates and is hands-on in supporting Tomoro’s growth planning. He has completed various curriculums and certifications, such as New York University’s graduate studies in financial planning, is a Certified Exit Planning professional, and Investment Advisor Representative. He and his family reside in Colts Neck, NJ.
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The S&P 500 Index is a market index generally considered representative of the stock market as a whole. The Index focuses on the large-cap segment of the U.S. equities market. The Hang Seng Index (HSI) is a market-capitalization-weighted stock market Index in Hong Kong. It is used to record and monitor daily changes of the largest companies of the Hong Kong stock market and is the main indicator of the overall market performance in Hong Kong.
Indices are unmanaged, and one cannot invest directly in an index. Past performance is not a guarantee of future results. All investments contain risk and may lose value. Investing in the bond market is subject to certain risks including market, interest rate, issuer, credit, and inflation risk. Equities may decline in value due to both real and perceived general market, economic, and industry conditions.
Statistics sources from Central Bank Rates and Bloomberg.