When you hear people talking about the value of retaining an estate planning lawyer you may be skeptical at first. After all, what is so hard about arranging for the transfer of assets after you pass away? You may even think that you can simply give away most of your assets to those who would otherwise be inheriting them while you are still alive.
The reality is that there are tax laws that can make it complicated to transfer assets to your loved ones without losing a lot in the process, both when you are alive in the form of the gift tax and after you die in the form of the estate tax. Estate planning lawyers understand these statutes thoroughly and they have an arsenal of tools at their disposal that can provide their clients with optimal tax efficiency.
There was a recent newsworthy event here in the area that is interesting to look at from a tax perspective. Unless you are living under the proverbial rock you heard about Yankee shortstop Derek Jeter collecting his 3,000 hit. He became the 28th player to do so when he launched a solo shot into the left field bleachers at Yankee Stadium on July 9th.
A 23-year-old fan named Christian Lopez caught the historic ball. He gave it to the Yankees rather than keeping it for himself or selling it, and how you feel about the wisdom behind that decision is something to decide for yourself. Especially when you consider the fact that the Yankees gave Lopez some choice seats for the rest of this year along with some autographed bats and such.
According to CNN, if the IRS decides that the transfer of resources between the Yankees and Lopez constituted income earned by Lopez, he may be looking at a tax bill of around $14,000.
Alan Augulis, Estate Planning Attorney
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