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Monday, January 16, 2012

Estate Taxes in Illinois

The uncertainty surrounding the exemption amounts for Federal and Illinois estate taxes for 2012 and beyond has caused confusion for many clients. For 2012, the Federal estate tax exemption rises to $5.12 million (adjusted for inflation from the 2011 amount). After 2012, unless new laws are passed by Congress, the exemption amounts reverts to $1 million.
In Illinois , the exemption amount was increased to $3.5 million for 2012 and $4 million for 2013 and thereafter.
Therefore, in 2012, we have the same situation as in 2011, where an estate may be exempt from Federal estate tax, but subject to the Illinois estate tax.
Unless Congress extends the higher exemption amounts after 2012, 2013 could have estates subject to Federal estate tax and not subject to Illinois estate tax.
The bottom line is to have your plan reviewed to make sure that you are ready for any possibility.

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