Changes To Washington State Estate and Gift Taxes for 2014
In 2013, the State of Washington enacted law to change the “applicable exclusion amount” for Washington’s estate tax. The “applicable exclusion amount” is the amount that passes free of estate tax. For the past several years, Washington’s applicable exclusion amount has been $2,000,000. So, the first $2,000,000 in value of an estate passed free of Washington’s estate tax. Only the amount in excess of $2,000,000 was subject to Washington’s estate tax (assuming no other exclusions or other deductions were applicable, such as the unlimited marital deduction). Under the new law, Washington’s applicable exclusion amount will be adjusted annually based on the percentage change in the most recent October consumer price index for the Seattle-Tacoma-Bremerton metropolitan area over the same index for the previous October. Washington’s Department of Revenue has announced that the state’s applicable exclusion amount for 2014 will be $2,012,000.
The applicable exclusion amount for federal estate taxes also adjusts. That amount will be $5,340,000 for 2014.
Gifts are subject to federal gift tax, generally payable by the donor of the gift. However, there is an annual exclusion from gift tax. A person may give up to $14,000 to each donee of a gift and no gift tax is payable on that gift. The annual exclusion was $14,000 for 2013 and remains at that level for 2014.
If you need assistance with estate planning, contact Per E. Oscarsson or one of the other attorneys in Beresford Booth’s Estate Planning and Probate Group.