2024 Personal Tax Planning Guide

Due to the inflation adjustment for 2023 and the anticipated inflation adjustment for 2024, the lifetime gift and generation-skipping transfer tax exemptions appear to have increased by $1,550,000 (or $3,100,000 per couple) over the past two years. This fairly significant increase gives even those who had previously utilized their exemptions an opportunity to make additional tax-free gifts or allocate GST tax exemption to existing trusts in order to exempt them from generation-skipping transfer tax in the future.

The required minimum distribution (RMD) rules are complex and lead to unintentional failures. The Secure 2.0 legislation has reduced the excise tax for failure to timely take a RMD. The excise tax is reduced from 50% to 25% of any portion of the RMD not timely distributed. Further, if a taxpayer identifies the issue and corrects the RMD failure quickly (generally within 2 years), the excise tax is reduced to 10%.