The IRS has announced the 2024 inflation adjustments for many tax provisions, including exemptions for estate, gift and generation-skipping transfer taxes and the annual exclusion amount for gifts.
The federal lifetime gift tax exemption has been indexed for inflation and therefore increased from $12,920,000 in 2023 to $13,610,000 in 2024. Also, the generation skipping transfer tax exemption has also been indexed for inflation and therefore increased from $12,920,000 in 2023 to $13,610,000 in 2024.
The gift tax annual exclusion amount increased to $18,000 for 2024. The amount increased from $17,000 in 2023. This is the amount that each person can give to another person without using any gift and estate tax exemption. Payments of tuition to schools and medical expenses to health care providers do not count against either the $18,000 annual gift tax exclusion or the $13,610,000 gift and estate tax exemption.
For more information on tax inflation adjustments for tax year 2024: