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2021 Tax Rates and Exemption Amounts for Estates and Trusts
By Nina Windsor on January 22, 2021 at 11:00 AM

Now that the new year has arrived, it is a good time to catch up on the latest tax rates for estate and trust income tax brackets and exemption amounts for estate, gift and generation-skipping transfer (GST) taxes in 2021. The Internal Revenue Service adjusts these figures annually for cost-of-living increases.

Below is a summary of the 2021 figures. The original news release from the IRS may be found here.

2021 Gift, GST and Trusts & Estates Income Tax Rates

Gift tax: The lifetime gift tax exemption for gifts made during 2021 is $11.7 million (increased from $11.58 million in 2020). The top marginal rate remains 40 percent. The gift tax annual exclusion amount remains $15,000. The annual exclusion for gifts made to noncitizen spouses in 2021 is $159,000 (increased from $157,000 in 2020).

GST tax: The GST tax exemption amount, which can be applied to generation-skipping transfers (including those in trust) during 2021, is $11.7 million (increased from $11.58 million in 2020). The rate remains 40 percent.

Income tax: The tax rate schedule for estates and trusts in 2021 is as follows:

If taxable income is:

The tax is:

Not over $2,650

10 percent of taxable income

Over $2,650 but not over $9,550

$265 plus 24 percent of the excess over $2,650

Over $9,550 but not over $13,050

$1,921 plus 35 percent of the excess over $9,550

Over $13,050

$3,146 plus 37 percent of the excess over $13,050

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