Seth Schlessel (https://www.schlessellaw.com/how-does-new-york-state-gift-tax-work/), a Long Island estate planning attorney at Schlessel Law PLLC, offers valuable insights into how the New York State gift tax works. With the often complex nature of estate planning laws, Schlessel provides clarity on the rules and implications of gifting assets within New York State, helping residents understand the legal and financial aspects of transferring wealth to their loved ones.
As a Long Island estate planning attorney, Seth Schlessel emphasizes the importance of understanding the distinctions between New York's estate tax and the federal gift tax. While New York does not impose its own gift tax, Schlessel highlights that gifts made within three years of a person's passing may still be subject to New York’s estate tax. This is an essential consideration for those planning their estates, as it could significantly impact the total tax liability of an estate.
Long Island estate planning attorney Seth Schlessel further explains that New York residents must navigate both federal and state tax laws when it comes to gifting assets. Under federal law, individuals are allowed to gift up to $17,000 per recipient annually without triggering any gift tax obligations. Schlessel explains, "This exemption allows individuals to transfer wealth to family members and other beneficiaries without having to worry about immediate tax consequences, which can be a key tool in minimizing estate taxes." Schlessel underscores the importance of careful planning to maximize these opportunities while remaining compliant with state and federal regulations.
Seth Schlessel, as a Long Island estate planning attorney, can help clients understand that gifts exceeding the annual federal exemption amount could be subject to federal gift tax and would also reduce the individual’s lifetime estate tax exclusion. This exclusion is currently set at $12.92 million per person but is expected to decrease to $5 million (adjusted for inflation) in 2026, a critical point for those considering larger gifts as part of their estate planning strategy.
Despite the absence of a New York-specific gift tax, Schlessel warns that certain gifts made within three years of death may still be added back into the estate’s value for tax purposes. Known as the “three-year clawback rule,” this provision can have significant financial consequences for heirs and beneficiaries. Schlessel explains that this rule was introduced to prevent individuals from avoiding estate taxes by gifting large amounts of their assets shortly before death. "It’s a crucial aspect of New York's estate tax law that many people are unaware of," Schlessel says, emphasizing that it can have a profound impact on the overall tax burden of an estate.
Seth Schlessel also highlights the importance of considering other potential tax liabilities when planning gifts, including capital gains taxes. For example, gifting highly appreciated assets such as stocks or real estate may result in the recipient facing significant capital gains taxes upon sale. Schlessel recommends that individuals consult with a qualified estate planning attorney to explore strategies such as gifting cash or assets that have not appreciated significantly, which could mitigate these tax implications.
Planning for the future can be a daunting task, especially when tax laws are involved. Seth Schlessel works with individuals and families to help create comprehensive estate plans designed to preserve wealth across generations. By providing clear and detailed guidance on New York's estate and gift tax laws, Schlessel can assist clients in handling tax planning, facilitating a smooth transfer of their assets with minimal tax liability.
Understanding the nuances of gift and estate taxes in New York is critical for effective estate planning. With estate tax laws in constant flux, Schlessel urges residents of Long Island and beyond to review their estate plans regularly and consult with an experienced estate planning attorney to help ensure their wishes are carried out efficiently.
For those looking to secure their financial legacy, Schlessel Law PLLC can provide tailored estate planning services, addressing the unique needs and concerns of each client. Whether it involves gifting strategies, setting up trusts, or preparing wills, Seth Schlessel’s approach can further ensure that clients’ wealth is protected, and their families are provided for.
About Schlessel Law PLLC:
Schlessel Law PLLC, based in Long Island, New York, focuses on estate planning, elder law, and real estate law. Led by Seth Schlessel, the firm is dedicated to providing personalized legal services that help clients secure their assets, plan for the future, and facilitate a smooth transfer of wealth. Schlessel Law PLLC takes pride in its client-centered approach, offering comprehensive estate planning solutions that address the unique needs of each individual and family.
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Company Name: Schlessel Law PLLC
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Phone: (516) 574-9630
Address:34 Willis Ave Suite 300
City: Mineola
State: New York 11501
Country: United States
Website: https://www.schlessellaw.com/
