By Steven J. Oshins, Esq., AEP (Distinguished) When the clock strikes midnight the evening of December 31, 2025, the federal estate and gift exemption will drop in half and many wealthy people will kick themselves for failing to make their gifts and use their gift tax exemption in time. That is, assuming the incoming President and Congress don’t extend the current laws before they expire. What is FOMO? “FOMO” is the fear of missing out. Many wealthy people fear missing out on their large gifting prior to the end of end of 2025. If the federal estate and gift tax…
The Upcoming 2025 Trust Tsunami and How to Handle it
By Steven J. Oshins, Esq., AEP (Distinguished) The estate and gift tax exemption is scheduled to drop in half at the beginning of 2026. This is going to shift the supply/demand ratio so far in favor of estate planners that wealthy prospective clients who know they need to make their large gifts need to start acting now. If wealthy clients wait until the last minute, they will likely find that no capable estate planners have any capacity to get the gift trust(s) drafted, executed and funded by the end of 2025. Act Now! One strategy is to get the gift…
Heckerling 2024 Reports from the ABA
The 2024 Heckerling Institute was held in-person (and virtually) in Orlando on January 8-12 and marked the conference’s 58th year. The Phillip E. Heckerling Institute on Estate Planning is the nation’s premier conference for estate planning professionals, offering unparalleled educational and professional development opportunities for all members of the estate planning team. Over the course of the conference’s five days, numerous timely topics of interest to estate planners of all designations—including, but not limited to, attorneys, trust officers, accountants, charitable giving professionals, elder law specialists, wealth management professionals, and nonprofit advisors. As they have done for many years, the American…
Projecting the Year-by-Year Estate and Gift Tax Exemption Amount
By Steven J. Oshins, Esq., AEP (Distinguished) The federal estate and gift tax exemption is currently $12,060,000 per person. This number increases (or decreases) each year based on inflation and then is rounded. This article does nothing extraordinary. It simply lays out the projected increases over the next few years based on the most recent inflation rate which is 8.5%. Anybody with a calculator can compute these numbers, but many people have not yet done so, so the numbers outlined herein may come as a shock! Trump Tax Act The Trump Tax Act increases (or decreases) the federal estate and…
Did You Know That Nevada Has Laws Allowing for Larger Valuation Discounts Than in Every Other State?
By Steven J. Oshins, Esq., AEP (Distinguished) Estate planners have been rushing to help clients make large gifts before the gift and estate tax exemption drops in half at the end of 2025. But are estate planners truly maximizing the wealth transfer for their clients? Most are not doing so, simply because they’re failing to take advantage of a legislation I authored that passed and became law in Nevada’s 2009 legislative session. This was likely overlooked because the gift and estate tax exemptions exponentially increased soon after that thereby making it unnecessary for the smaller net worth clients to fully…
Basis Bump Planning: Using Grandma to Get a Stepped-Up Income Tax Basis
By Steven J. Oshins, Esq., AEP (Distinguished) The federal estate and gift tax exemption is at an all-time high. In fact, it’s so high that very few people would owe any federal estate tax if they were to die today. Therefore, almost everybody dies leaving unused estate tax exemption on the table. Estate Tax Exemption as Currency Dollar, Euro, Yen, Pound, Franc, Peso, Estate Tax Exemption! Yes, Estate Tax Exemption! Estate Tax Exemption is a form of currency. However, unlike the other currencies, if you don’t use it during your lifetime you can’t pass it to your heirs (other than…
Saving State Income Taxes: NING Trusts and Completed Gift Non-Grantor Options
By Steven J. Oshins, Esq., AEP (Distinguished) Prior to the Trump Tax Act, state income taxes paid were deductible against federal income tax. However, the Trump Tax Act limits the amount of the federal income tax deduction for state income taxes paid, real property taxes paid and sales taxes paid to a cumulative (yes, cumulative!) total of $10,000 per year. The $10,000 is used up for property taxes only for many of our clients. Therefore, state income taxes paid are essentially no longer deductible! This is why state income tax avoidance planning has arguably become the hottest area of estate…
The 2022 Biden Estate Tax Cliff: Preparing After the 1/1/2013 and 1/1/2021 Cliffs
By Steven J. Oshins, Esq., AEP (Distinguished) If you are an estate planner, you likely had your best revenue ever in 2012. Then you likely annihilated your previous revenue record in 2020. This happened because of the so-called “fear of missing out” with different tax “cliffs” expected to occur at the end of those two years, thereby causing a commotion among the wealthy. JANUARY 1, 2013 FISCAL CLIFF Rewind back to the year 2012. President Obama was in office and the $5 million estate and gift tax exemption was scheduled to expire and roll back to only $1 million at…
9th Annual Dynasty Trust State Rankings Chart Released
By Steven J. Oshins, Esq., AEP (Distinguished) The 9th Annual Dynasty Trust State Rankings Chart has been released! This year’s Chart factors in the new era of Dynasty Trusts. The Chart is an easy-to-use summary of leading Dynasty Trust states that shows the material differences among the states and ranks them according to usability and flexibility. Planners often focus on the multi-generational estate tax benefits of a Dynasty Trust. However, the Tax Cuts and Jobs Act of 2017 essentially doubled the federal estate and gift tax exemption which, after inflationary increases, is now $11.58 million per person, or $23.16 million…
The Biden Estate Tax Cliff: Gifting Like it’s 2012 All Over Again!
By Steven J. Oshins, Esq., AEP (Distinguished) Those estate planning attorneys who were in practice in 2012 surely remember the last few months of the year when prospective clients were calling and emailing all day long every day literally begging us to take “just one more client”! There was a mad rush to make $5 million gifts before the estate tax exemption was going to drop back down when the clock struck midnight at the end of 12/31/2012. Most of the experienced attorneys were so busy that they stopped taking new clients in October or November. FAST FORWARD TO 2020…