Expanded Annual Exclusion Amount

Course: Estate Planning
Lesson 5: Transfer Taxation II – Lifetime Transfers

Student Question:

Hi Bruce,

I’m reading about the “expanded Annual Exclusion Amount of $155,000.” Just so I’m clear, is this an expansion from the “regular” $15,000 Annual Exclusion Amount? And what is it for?

Thanks!

Kevin

---

Instructor Response:

Hi Kevin,

You are correct. The annual gift tax exclusion for U.S. citizens is $15,000 per donor per year, but non-U.S. citizen spouses receive an “expanded” amount of $155,000 (2019, as indexed).

The reason for the apparent generosity is that non-U.S. citizen spouses are not eligible for the unlimited marital deduction from gift and estate taxes.

Bruce