By Jackie R. Luthringshausen
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October 17, 2024
One important goal of effective estate planning is to minimize the amount of tax that your estate will be subject to upon your death. If the value of your assets at your death exceeds a threshold amount, your estate will be subject to federal estate tax and potentially state estate tax as well, depending on the state in which you reside at your death. Currently, twelve states (including Illinois) and the District of Columbia impose a state estate tax in addition to any federal estate tax due. Currently, the Illinois estate tax exemption is $4 million per individual, which means a person can transfer up to $4 million worth of assets at death without incurring Illinois estate tax. The current federal estate tax exemption, put in place in 2017 by the Tax Cuts and Jobs Act (TCJA), is $13.61 million per individual; however, this amount is scheduled to “sunset” at the end of 2025 and revert to pre-TCJA levels, which is estimated to be around $7 million per individual (adjusted for inflation).
