With Higher Taxes Looming, Are Your Clients Ready?

With Higher Taxes Looming, Are Your Clients Ready? - Ed McCarthy, CFP® (Journal of Financial Planning, Nov. 2011) (JEH: I have posted several other links on this blog during the last few months that highlight estate planning opportunities under the 2010 tax act. For anyone with assets valued in excess of $1 million but less than $5 million (and certainly beyond that), or twice those amounts for married couples, more advanced planning such as qualified personal residence trusts, "intentionally-defective" grantor trusts, charitable lead trusts, and similar techniques should be considered. Most commentators agree that Congress will not likely reduce the now reunified gift, estate, and GST exemption to $1 million per person, which will occur as of 2013 without additional legislation, but no one knows what the "compromise" will be. Nearly all commentators are recommending the use of the above (and other) lifetime techniques that utilize the unprecedented $5 million per person exemption. Unfortunately, if you live in Connecticut or Tennessee, you have to deal with a state-level gift tax in addition to the federal rules. Please browse my posts over the past five months (from June 2011 to present) to obtain numerous summaries with more detailed information. For practitioners, please join me at the Heckerling Institute on Estate Planning, which I have attended nearly every year since 1999 and which will extensively cover these topics. Our American Bar Association group will also be reporting on and summarizing the Institute's proceedings, which will be available here.)