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Exemption From Federal Generation Skipping Transfer Taxes: 1997 - 2014

Table Showing Federal GST Tax Exemption and Rate: 1997 - 2014

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The exemption from federal generation skipping transfer taxes has increased over the years while the tax rate has decreased. Below is a chart that shows the changes in the generation skipping transfer tax exemption and tax rate from 1997 through 2014.

Tax years 2010 through 2012 were based on the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act ("TRA 2010") that was signed into law by President Obama on December 17, 2010. This law was only good for two years and so it supposed to sunset on December 31, 2012, meaning that on January 1, 2013, the federal generation skipping transfer tax exemption and rate were supposed to default to the numbers that were in effect in 2001/2002. Instead, on January 2, 2013, President Obama signed the American Taxpayer Relief Act ("ATRA" for short) into law, which has led to the permanent extension of the laws governing estate taxes, gift taxes and generation skipping transfer taxes that were put in place by TRA 2010 with one notable exception - the top estate tax, gift tax and generation skipping transfer tax rate under TRA 2010 was 35%, but ATRA increases the top rate to 40%. TRA 2010 unified the estate tax, gift tax and generation skipping transfer tax exemptions and also provided for inflation indexing of these exemptions beginning in 2012, so over the years the exemptions will gradually increase above the $5 million exemption put in place by TRA 2010.

To view the federal estate tax exemptions and top estate tax rates from 1916 (the first year the estate tax was enacted) through 1997, please refer to the following: Table Showing Federal Estate Tax Exemption and Rate: 1916 - 1997.

To view the federal estate tax exemptions and top estate tax rates from 1997 through 2014, please refer to the following: Table Showing Federal Estate Tax Exemption and Rate: 1997 - 2014.

To view the federal lifetime gift tax exemptions and top gift tax rates from 1997 through 2014, please refer to the following:Lifetime Exemption From Federal Gift Taxes: 1997 - 2014.

To view the annual exclusion from gift taxes from 1997 through 2014, please refer to the following: Annual Exclusion From Gift Taxes: 1997 - 2014.

Historical and Future Generation Skipping Transfer Tax Exemptions and Rates

Year GST Exemption GST Tax Rate
1997 $1,000,000 55%
1998 $1,000,000 55%
1999 $1,010,000 55%
2000 $1,030,000 55%
2001 $1,060,000 55%
2002 $1,100,000 50%
2003 $1,120,000 49%
2004 $1,500,000 48%
2005 $1,500,000 47%
2006 $2,000,000 46%
2007 $2,000,000 45%
2008 $2,000,000 45%
2009 $3,500,000 45%
2010 No generation skipping transfer tax N/A
2011 $5,000,000 35%
2012 $5,120,000 35%
2013 $5,250,000 40%
2014 $5,340,000 40%

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