Gift and Estate Tax Planning Opportunities

On Behalf of | May 4, 2012 | Firm News |

We are now in the final year of the historically high federal estate tax exemption amount of $5,000,000. Unfortunately, under the current law, on January 1, 2013, the exemption amount will fall to $1,000,000. It is anticipated that Congress may act this year to change the exemption amount to perhaps $3,500,000. But as we have seen before, it is impossible to predict what, if anything, Congress will do, or when.

The estate tax and the gift tax is currently a unified tax. This means that you may use your exemption to make lifetime gifts without incurring any gift tax, up to the full $5,000,000 per individual. Whether your personal balance sheet reflects real estate, equities, a family business, or shares in a privately held company, it is important to us that you are aware of the advanced planning opportunities available to you so that you can make an informed decision as to whether you wish to take advantage of the wealth transfer strategies available.

In addition to the substantial estate/gift tax exemption, interest rates remain very low. And the real estate and capital markets have yet to fully recover from the fall. All of these variables combine to create a perfect storm of sorts, an opportunity to transfer significant wealth to the next generation at a reduced economic cost. Not only will the transfer of the asset result in a reduction in the size of your taxable estate, but all future appreciation on the asset will be transferred as well. Depending on the strategy which is most appropriate for your family, the transaction can be structured to transfer income to the next generation as well.

Given the timeframe needed to fully implement any recommendations by the end of this year, I would ask that you contact us as soon as possible. Please contact me directly, or contact Mary Beth Ancona to arrange a time to meet with me personally and discuss how you might take advantage of this unprecedented window of opportunity.


WealthPLAN, PC

Francis B. Doyle

Attorney at Law