By Robert S. Keebler, CPA, MST, AEP (Distinguished) As you probably know all too well, tax rates increase substantially in 2013 and later years for high income taxpayers. Not only did the top income tax rate increase from 35% to 39.6%, but a 3.8% Medicare surtax is now imposed on net investment income (NII). The 39.6% rate now applies to taxable income over $450,000 for married taxpayers and $400,000 for single taxpayers. In addition, net investment income is subject to a new 3.8% Medicare surtax to the extent modified adjusted gross income exceeds $250,000 for married taxpayers and $200,000 for…
New IRS Form 706 Implements 2 Major Changes in the Law
At The Ultimate Estate Planner, Inc. it’s important to us to keep our customers and the rest of the estate planning community informed about very important and exciting updates as it happens. A special thank you to Joseph C. Mahon featured on WealthManagement.com. IRA Issues Draft Form 706 by Joseph C. Mahon The revisions implement two major changes in the law On Aug. 16, the Internal Revenue Service released a draft version of a revised Form 706 (the 706), “United States Estate (and Generation Skipping Transfer Tax) Return.” www.irs.gov/pub/irs-dft/f706–dft.pdf. It didn’t release instructions. The revisions implement two major changes in…
IRS Issues Long-Awaited Portability Guidance
On June 15, 2012 the Internal Revenue Service issued temporary regulations (T.D. 9593) and proposed rules (REG-141832-11) on the portability of a deceased spousal unused exclusion amount applicable where the death of the first spouse occurs on or after Jan. 1, 2011. Here are the highlights. Election Required Portability must be elected on a “timely filed” Form 706, which, regardless of the size of the estate, is a return filed within nine months of death or, if an extension has been granted, the last day of the extension period. The IRS has required that the portability election be made on…
Attract, Engage & Work with Families with Taxable Estates and Their Advisors
For decades many of us, as wealth strategies planners, have wondered not only how but if we should attract, engage and work with affluent families and those with complex taxable estates. Their advisors are more protective. The solutions are more complicated and create larger liability. Though the fees may be greater, are they enough to cover the time and effort – especially if we only do it occasionally? The Laureate Center for Wealth Advisors has the training and education needed to attract, engage, and implement work in the taxable estate arena. You owe it to yourself and your clients to…
How Do You Convince Clients to Actually Do GRATs (and Other Estate Tax Planning)?
Most practitioners know about the estate tax planning “window of opportunity” that may be closing soon. We’ve only got the $5.12 million gift tax exemption until year-end and President Obama’s budget proposal has targeted “loopholes” like GRATs and valuation discounts. You would think these urgencies would be enough to convince high net worth clients to move forward with advanced-level planning (like Dynasty Trusts, GRATs, LLCs, installment sales and completed gift DAPTs) — but it’s still difficult to get people to take action! Having run into this client procrastination problem too many times, I realized that this has less to do…
4 Estate and Tax Planning Steps to Take in an Uncertain Year
Regardless of whether Congress acts on taxes by year-end, estate planning attorney John Scroggin says taxpayers shouldn’t dally Reposted from AdvisorOne.com | By Michael S. Fischer, AdvisorOne Planners will not know before year-end what changes on the tax front are in the works for 2013, according to John Scroggin, a business, tax and estate planning attorney and a popular speaker at advisor conferences based in Roswell, Ga. A last-minute deal in a post-election lame duck session of Congress, similar to the one in 2010, is highly unlikely. That means planning this year will have to take place in a vacuum,…
Tax Expert Marty Shenkman: Two Tax Mistakes to Avoid With Clients in 2012
Despite the uncertainty of where estate, income and capital gains rates will be this year, you still need to plan. Reposted from AdvisorOne.com | By Marlene Y. Satter, AdvisorOne Martin Shenkman of Shenkman Law in Paramus, N.J. doesn’t hesitate to tell it like it is about tax planning in 2012: “This is not a normal year,” he says. However, that’s no excuse for what he sees as two huge mistakes that advisors and their clients often make as they quiver with uncertainty over what Congress may or may not do this year regarding taxes. Those two mistakes? Acting like an…
Leimberg Information Services: 60-Second Planner on President Obama’s Estate & Income Tax Proposal
Reproduced with Permission by and Courtesy of Leimberg Information Services, Inc. (LISI). For information about how to subscribe to LISI, click here. As mentioned previously by Robert S. Keebler in a previous blog entry, President Obama’s Fiscal Year 2013 budget was released on February 13th. Follow this link to get a full copy of the 2013 Budget. The Treasury’s Green Book containing general explanations of the Administration’s revenue proposals can be found here. We now wanted to share with you two Leimberg Information Services, Inc. 60-Second Planner podcasts in response to this budget. One podcast deals with the estate and…
IRS Extends Deadline to Make Portability Election
On February 17th, the IRS released an important Notice allowing an extension to make a portability election for certain qualifying estates. An executor of a qualifying estate that wants to obtain the extension granted by this notice must file the application for a six month extension no later than 15 months after the decedent’s date of death. With the extension granted by this notice, the Form 706 of a qualifying estate will be due 15 months after the decedent’s date of death. The first of these extensions (and underlying Form 706) will be due April 2nd. Estates qualifying for this…
Interview on Dynasty Trusts with Guest Expert, Steven J. Oshins, Esq.
Steven J. Oshins, Esq. is a nationally renowned estate planning and asset protection attorney based in Las Vegas, Nevada, with clients all over the United States. Steve was the author of Nevada’s 365-year Dynasty Trust law and often works jointly with estate planning attorneys from other states on setting up dynasty trusts and other advanced level estate planning and asset protection techniques. We recently had the opportunity to interview Steve on the topic of Dynasty Trusts. UEP: Would you please start by describing how the Dynasty Trust works? Steve Oshins: Let me begin by clarifying that I’m talking about the…