How the GST tax is assessed. The GST tax is separate from, and in addition to, the estate tax. The tax is currently calculated at a flat rate of 40% (equal to the estate and gift tax rate) on transfers above the lifetime estate and gift tax exemption amount, which in 2026 is $15 million per individual.
The Generation Skipping Transfer Tax (GSTT) Exemption
Like the unified credit, in 2026 the GSTT exemption will be increased to $15,000,000. While seemingly similar to the unified credit, it is important to note that the GST tax exemption is not “portable” or shareable with your spouse.
For 2026, the federal estate, gift, and generation-skipping transfer (GST) tax exemption amount increases significantly to $15 million per person ($30 million for married couples), up from $13.99 million in 2025, with the annual gift tax exclusion remaining at $19,000 per recipient, notes IRS.gov. This higher exemption allows individuals to transfer more wealth tax-free during life or at death, while the annual exclusion lets people give away up to $19,000 to any individual without tax implications, SmartAsset.
The total of lifetime gifts and the estate are eligible for a lifetime exemption, which is set at $13.99 million in 2025. The exemption amount is indexed for inflation, and was scheduled to be reduced by half after 2025. The higher exemption level was made permanent and slightly increased to $15 million in 2026 by P.L.
Inheritance law in 2026 (specifically federal US law) involves a major shift as the estate and gift tax exemption is set to revert from its temporarily inflated 2025 level (around $14M) back to its pre-2018 inflation-adjusted level, potentially around $7 million per individual, creating a critical planning window in late 2025 to "lock in" the higher exemption using tools like SLATs (Spousal Lifetime Access Trusts). While state laws vary (some states have separate inheritance taxes), the main federal change means significantly lower thresholds for tax-free wealth transfer starting in 2026, making proactive estate planning crucial for high-net-worth individuals to avoid substantial taxes.
The new law will increase the estate tax exemption to $15 million for single people and $30 million for couples in 2026 and allow it to rise with inflation moving forward. In other words, a couple will be able to leave $29.99 million to their heirs in 2026 without paying a cent of estate tax.
Specific individuals and businesses are exempt from GST registration, including: Agriculturists (Also read - GST Exemption for Farmers) Individuals and businesses with an annual turnover below INR 40 lakhs for goods and INR 20 lakhs for services (INR 20 lakhs and INR 10 lakhs for specified categories)
The following category of tax persons are exempted from payment of 1% of GST in Cash 1. Registered taxpayers who have paid income tax above Rs 1.00 in Income Tax during the last two years continuously 2. Taxpayers who have zero-rated supplies without payment of duty and claimed refund of more than Rs 1.00 lac 3.
Goods and services tax credit
According to the federal government, the maximum annual amount an individual may receive from July 2025 to June 2026 is $533, while a married or common-law couple could see up to $698 combined.
One Big Beautiful Bill Tax Law Changes for your 2026 (and on) tax returns
The federal government legislated temporary GST/HST relief on taxable foods and beverages, as well as other qualifying items, for a two-month period from December 14, 2024, to February 15, 2025.
For 2026, the federal lifetime gift and estate tax exemption significantly increased to $15 million per individual (or $30 million for a married couple) due to the new One Big Beautiful Bill Act (OBBBA), preventing a planned reduction and making this higher amount permanent with future inflation adjustments, allowing for greater tax-free wealth transfers. This applies to gifts made during life and assets transferred at death, with the annual gift tax exclusion remaining at $19,000 per recipient.
To avoid the 22% tax bracket (or any higher bracket), focus on reducing your taxable income through strategies like maxing out 401(k)s and HSAs, deferring bonuses, tax-loss harvesting, smart charitable giving, and strategic asset location, understanding that higher rates only apply to income within that bracket, not your entire income.
Yes, you can gift your son $100,000, but since it's over the 2025 annual exclusion of $19,000, you'll need to file a gift tax return (Form 709), though you likely won't owe taxes unless you've already used up your large lifetime exemption (over $13.99 million in 2025). Your son pays no tax on the gift, but you, as the giver, must report the amount exceeding the annual limit, which counts against your lifetime exemption.
The IRS $600 rule refers to a change in reporting requirements for third-party payment apps (like Venmo, PayPal) for taxable income from goods and services, where platforms must send a Form 1099-K if you receive over $600 in a year, intended to capture gig economy/side hustle income, though delays and phased implementation have adjusted the timeline, with current rules for 2024 using a higher threshold ($5,000) before fully phasing to $600 for future years, but remember all taxable income, regardless of form, must always be reported.
The IRS primarily learns about large gifts when you file Form 709, the Gift Tax Return, for amounts exceeding the annual exclusion (e.g., $19,000 per person in 2025). They can also discover gifts through third-party reporting (banks reporting large cash transfers), audits of your estate, or by matching transactions to public records, especially for significant asset transfers like property, which might trigger property tax reassessments.
India's GST regime is undergoing a landmark transformation with the 56th GST Council meeting unveiling GST 2.0 - next-generation reforms simplifying tax slabs to 5%, 18%, and 40%. Effective from September 22, 2025, these reforms aim to ease compliance, boost consumption, and fuel economic growth.
There are really only two circumstances where customers are exempt from paying GST. The first is if it falls under the basic exemptions such as basic food, sales at duty-free and some medicines for example. The other circumstance is when a business is small enough that they don't have to register for GST credits.
During your lifetime, all applicable transfers of wealth that you make are automatically applied to your lifetime GST tax exemption, unless you elect otherwise. For transfers at death, the exemption may be allocated as you direct in your will or as your executor directs if unspecified in your will.
Businesses are required to register for GST and pay tax on their annual turnover if their annual revenue exceeds Rs. 40 lakhs in the case of goods supplied and Rs. 20 lakhs for the supply of services.
A penalty of Rs. 10,000 or 10% of the tax due, whichever is higher, for not registering despite being liable to do so. A penalty of Rs. 10,000 or the tax amount, whichever is higher, for collecting GST but not depositing it to the government within three months.