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Ask A CPA - Estate Tax

Unified Tax Credit

Every estate gets a Federal Unified Tax Credit for the amount of tax that would be levied. In year 2013 the Federal Unified Tax Credit is $2,045,800 yielding a exclusion amount of $5,250,000 Million. That is the limit that you can leave your heirs free of federal estate taxes. It is also known as the exemption equivalent amount. The unified tax credit is cumulative. It includes the taxes due on taxable gifts that you have made over the course of your life (taxes on these gifts are usually not due until you die). Non-taxable gifts of up to $14,000 per person, per year are not counted against the federal unified tax credit.

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