2014 Year-End Tax Planning

By Robert S. Keebler, CPA/PFS, MST, AEP (Distinguished), CGMA As we near the end of 2014, year-end tax planning again takes center stage. In this article we summarize a number of strategies that may produce substantial tax savings with just some year-end tax planning. Making Trust Distributions The tax brackets for trusts are much more compressed compared to the brackets for individuals. This suggests, if the governing instrument allows it, that trustees should consider making discretionary distributions of income to beneficiaries at the end of 2014 to reduce tax rates. Harvesting Ordinary Income Harvesting ordinary income is another part of…

Understanding Portability

By Robert S. Keebler, CPA, MST, AEP (Distinguished) | Volume 2, Issue 3 (March 2014) An interesting provision within the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (“2010 Tax Relief Act”) allows an executor of an estate of a married decedent the option to transfer any unused estate tax exemption amount to the surviving spouse.[1] Thus, for example, if a decedent used only a portion of his or her estate tax exemption, the estate could elect to have the remaining portion pass to the surviving spouse, giving the surviving spouse a larger estate tax exemption.[2] Although this portability…

BREAKING NEWS: IRS Issued Rev. Proc. 2014-18, Granting Relief for Some Late Portability Elections

The IRS issued Rev. Proc. 2014-18 today, announcing that it would grant blanket relief for the estates of persons who died in 2011, 2012, and 2013, if the estate was not required to file a return. The IRS announced that it will allow these estates to file a return to elect portability until December 31, 2014. Any estates of persons dying after 2013 that don’t file a timely return to elect portability can apply for a private letter ruling. For more information, click here to listen to LISI’s 60-Second Planner with nationally renowned CPA, Robert S. Keebler. Also, see Rev….

Robert Keebler’s 2014 Tax Planning Success Kit

More and more, you’re seeing clients (and prospects) turning their attention away from traditional estate tax and financial planning and toward income tax reduction and asset protection. Why? Because of ATRA’s higher ordinary and income tax rates, higher capital gains tax rates, deduction phase-outs and higher estate tax exemption, Obamacare’s “net investment income “surtax”, a higher estate tax exemption, and an increasingly lawsuit-happy society! Fortunately, it’s not difficult to re-tool your practice to meet this new demand for income tax and asset protection planning. You just need to “tweak” how you use many of the techniques already in your bag…

2013 Year-End Tax Planning Ideas (Part 3)

By Robert S. Keebler, CPA, MST, AEP (Distinguished) As we near the end of 2013, year-end tax planning again takes center stage. In the last two newsletters we covered two of the most important year-end planning strategies in detail—loss harvesting and Roth IRA conversions. In this newsletter we summarize a number of other strategies that may produce substantial tax savings. Making Trust Distributions The tax brackets for trusts are much more compressed than the tax brackets for individuals. Trusts begin being taxed at the top rate of 39.6% when income rises above $11,950. By contrast, individuals filing joint returns don’t…

Final IRS Form 706 Instructions Posted

Thanks to Robert Keebler of Keebler & Associates, LLP for the heads up that the final Form 706 instructions were posted on the IRS website on Tuesday. DOWNLOAD FINAL FORM 706 DOWNLOAD FINAL FORM 706 INSTRUCTIONS We also just held a teleconference with Bob on Wednesday on the New Form 706 & Portability. To purchase the handout materials and audio recording of this program, click here.

Alan Gassman & Jonathan G. Blattmachr: Stepping Up Efforts to Step-Up Basis for Married Couples

Thanks to generosity of Leimberg Information Services and nationally renowned estate planning attorneys, Jonathan G. Blattmachr, J.D., LL.M. (Taxation) & Alan S. Gassman, J.D., LL.M. (Taxation), Florida State Bar Certified Specialist in Wills, Trusts & Estates, we are pleased to provide to you a recently published article on LISI, where they discuss the importance of stepped-up basis planning for married couples. Also, for more information about Alan Gassmans’ JEST Trust Legal Document Form, click here. Alan Gassman & Jonathan G. Blattmachr: Stepping Up Efforts to Step-Up Basis for Married Couples EXECUTIVE SUMMARY: The capital gains tax may be the most…

IRS Released 2013 Draft Form 706

The IRS posted an an early release draft of Form 706 (posted on October 23, 2013). The IRS provides this information as a courtesy. To download the Draft Form 706, click here. Thanks to ATRA and the “permanent” $5+ million tax estate tax exemption, some people feel that fewer estates will be required to file a Form 706. But they’re wrong! Lots of estates that don’t exceed $5.25 million may want to file a 706 because of another 2010 Tax Act provision… “Portability”! Married couples may now fully utilize the first to die’s Estate Tax Exemption without bothering to set…

Monday Funny: A Proposed New Living Will Form

This was shared with us by a fellow colleague and we thought it was funny and a great way to start off the week (on a funny note!). Enjoy and please feel free to share! Proposed New Living Will Form I, _______________________, being of sound mind and body, do not wish to be kept alive indefinitely by artificial means. Under no circumstances should my fate be put in the hands of pinhead partisan politicians who couldn’t pass ninth grade biology if their lives depended on it or lawyers, doctors, and hospitals interested in running up the bills. If a reasonable…

IRS Announces Inflation Adjustments for 2014 – Increased Exemption Among Others

The Internal Revenue Service announced today annual inflation adjustments for more than 40 tax provisions, including the tax rate schedules, and other tax changes. Revenue Procedure 2013-35 provides details about these annual adjustments. Here are just a few of the adjustments that are coming: The tax rate of 39.6 percent affects singles whose income exceeds $406,750 ($457,600 for married taxpayers filing a joint return), up from $400,000 and $450,000, respectively. The other marginal rates – 10, 15, 25, 28, 33 and 35 percent – and the related income tax thresholds are described in the revenue procedure. The standard deduction rises…