U.S. Estate and Gift Taxation
The U.S. estate and gift tax system is essentially a "single tax" framework: it employs a unified lifetime exemption amount, with both lifetime gifts and posthumous estate transfers being combined for taxation; only the portion exceeding this threshold is subject to taxation. The key figures for 2026 are as follows:
- Lifetime tax exemption amount: US$15 million per person. The Big and Beautiful Act of 2025 has permanently established this provision, replacing the sunset clause under which the exemption amount was originally set to revert to approximately US$7 million in 2026;
- The maximum combined tax allowance for spouses is US$30 million. The spouse may inherit the unused portion of the other spouse's allowance (the "portable" mechanism), which effectively equates to the couple sharing a larger combined tax-exempt amount;
- The maximum tax rate is 40%. The portion of income exceeding the tax exemption amount is taxed at the progressive tax rate, with an upper limit of 40%;
- Annual gift tax exemption: US$19,000 per person. Small annual gifts given to any individual do not count toward the lifetime exemption limit (for gifts given to a spouse who is not a U.S. citizen, the limit is US$194,000).
USCPA Luo Xia, reminds you that for non-U.S. tax residents, the estate tax exemption threshold for U.S.-based assets is only $60,000—a remarkably low threshold. Additionally, the tax liability is reported and paid by the donor, while the donee typically owes no tax. Many cross-border families focus solely on income tax while overlooking the potential estate tax risks associated with U.S. stocks and U.S. real estate assets.
If you have any questions or need further help,
please contact us at the: USCPA Luo Xia +886 980919600
or Email: ustaxproservice@gmail.com
Also welcome to visit our website: https://www.ustaxproservice.com
(USTAX Service LLC)