- Annual Gift Exclusion: The amount you can gift to anyone without needing to file a gift tax return, will be $18,000 per gift recipient in 2024 (up from $17,000 in 2023). For married couples, this amount can be combined with your spouse, meaning a married couple could give up to $36,000 in 2024.
- Lifetime Annual Exclusion: The total aggregate amount of funds that you can give to anyone above your annual gift exclusion during your life or at death before owing estate or gift taxes, will be $13,610,000 in 2024 (up from $12,920,000 in 2023). For married couples, this amount can be combined with your spouse, meaning a married couple could give up to $27,220,000 in 2024 before owing estate or gift taxes on any gifts in the future.
- Five-Year 529 Super Funding Contributions: Your limit will be $90,000 in 2024 (up from $85,000 in 2023). You can gift any amount above your annual exclusion to a 529 plan, but you must file a gift tax return and pro-rate the gift for an entire five-year period to show the gift resulting in no tax due or credit exemption used.
- 401(k) Contributions: Your limit increased to $23,000 (up from $22,500 in 2023). Catch-up contributions if age 50 or older stayed the same at $7,500.
- IRA (Roth or traditional) Contributions: Your limit increased to $7,000 (up from $6,500 in 2023). Catch-up contributions if age 50 or older stayed the same at $1,000.
- HSA Contributions: Your limit increased to $4,150 for individuals or $8,300 for family (up from $3,850 and $7,750, respectively, in 2023).
- Federal Estate Tax Portability Unchanged: The ability to transfer a decedent’s unused federal estate tax exclusion amount to the decedent’s surviving spouse by filing a federal estate tax return (referred to as “portability”) remains in effect for 2024. The period for a late portability election remains five years after the decedent’s death. If your spouse died within the last five years and this election was not made, you should contact us about the advisability of making the election now.
- Required Minimum Distributions: For your qualified retirement plan accounts, the applicable age for starting required minimum distributions (“RMDs”) is now age 73 for individuals who attain age 72 after December 31, 2022, and will change to age 75 as of 2033 for individuals who attain age 74 after December 31, 2032. The current law also has eliminated pre-death RMDs from Roth accounts in 401(k) and 403(b) plans starting in 2024.
- 2025 Sunset of Lifetime Exclusion Amounts: As a reminder, the lifetime exclusion amounts are scheduled to sunset at the end of 2025, leading to potential tax increases across the board. It will decrease on January 1, 2026, to a $5,000,000 base amount (instead of the current $10,000,000 base amount) plus an inflation adjustment. Although Congress could act to prevent the decrease, we encourage you to start planning now if using the lifetime exclusion amounts might be appropriate for you.
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