Beginning January 1, 2022, there was an increase in the exclusion amounts for federal gift, estate and generation-skipping transfer taxes. This exclusion amount increased to $12.06 million from $11.7 million for 2022. This exclusion amount is currently scheduled to expire on December 31, 2025, resulting in a decrease to $5 million (inflation-adjusted).
The New York estate tax exclusion amount has increased to $6.11 million from $5.93 million.
The gift tax annual exclusion has also increased. For gifts to any person this year, the gift tax annual exclusion amount is $16,000, and, for gifts to a non-citizen spouse, the gift tax annual exclusion amount is $164,000.
Another new aspect of 2022 is the exploding popularity of cryptocurrencies and NFTs (non-fungible tokens). From 2015 to 2021, the amount of adults, on average, who have heard about cryptocurrencies increased from around 48% to 86% and the percentage of adults, on average, who are trading, investing or using cryptocurrency increased from about 1% to 24%. Over the past year, though, people have gained a particular interest in NFTs, so much so that the amount of global searches on Google for "NFT" is now higher than the amount of global searches for "crypto." If you are investing in, trading or using cryptocurrencies and/or NFTs, it is vital to ensure that they are accounted for in your estate plan.