The so-called "fiscal cliff" included changes to the estate tax that would have been devastating for many. If no deal was made to avoid falling over the cliff in 2013 the estate tax exclusion would have been reduced to just $1 million. The maximum rate of the tax would have gone up from the 35% that was in place in 2012 to a staggering 55%. After the crisis was averted via an 11th hour compromise we were spared the above fate. Going forward in 2013 we have much of the same with a slight … [Read more...] about Fiscal Cliff Compromise Provides Estate Tax Clarity
Each year many of us make resolutions that we intend to make good on once the holiday season has come and gone. This year we would like to urge everyone to consider the importance of estate planning. The statisticians tell us that the majority of people are going through life without a solidly constructed estate plan. If you are among them you are quite frankly doing your family a disservice. We never can predict the future, and even if you are a relatively young adult you should execute the … [Read more...] about New Year’s Resolution: Talk to an Estate Planning Lawyer
A lot of people would say that you have paid more than your share of estate taxes if you wind up parting with $471 million or so. The case of the estate of the deceased art collector Ileana Sonnabend demonstrates that this amount may not be enough for the Internal Revenue Service. It all revolved around a work of art, a sculptural combine called "Canyon" that is the creation of Robert Rauschenberg. This work would be very valuable on the open market if it wasn't for the fact that it can never … [Read more...] about When Is $471 Million Not Enough?
We would like to provide some clarity with regard to the spousal estate tax exemption at the federal level. If you are married you may leave any amount of money to your spouse without incurring any federal estate tax liability. However, this exemption should not be viewed as an estate planning cure-all. Invariably your husband or wife is going to want to leave the assets that he or she inherited from you to loved ones. At this point the estate tax will in fact be looming because the exemption … [Read more...] about A Look at Spousal Estate Tax Exemption
Taxation is a threat to the wealth that you have been able to accumulate throughout your life. There are some significant taxes that are levied on asset transfers and you must be aware of them and take the appropriate action to mitigate your exposure. First of all there is the federal estate tax that is applicable in all 50 states. The maximum rate of this tax in 2012 is 35% and the exclusion is $5.12 million. When you read the above you may come away thinking that you have no concerns because … [Read more...] about Don’t Overlook Death Taxes on the State Level
It is sometimes said that no good deed goes unpunished and this would seem to apply to gift giving in the United States. We have a federal gift tax that is unified with the estate tax. So, any gifts that you give that exceed the lifetime exclusion that is afforded to you are taxable at a rate of 35% in 2012. If this was not enough, next year the rate goes up to 55%. If your resources do exceed the exclusion amount you may want to look for ways to transfer assets to people who would someday be … [Read more...] about Indirect Giving Can Provide Tax Savings
During the midterm election year of 2010 the Bush era tax cuts were scheduled to expire. This became an issue that was hotly debated on the campaign trail, and immediately after the elections a new tax relief bill was indeed passed. It has subsequently been named the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010. Now we are in another election-year and there is a sense of déjà vu in the air. The aforementioned tax relief act is going to expire at the end of … [Read more...] about Candidates Will Invariably Talk Taxes
There are those who consider estate planning to be a "one and done" endeavor. You sit down with a good central New Jersey estate planning lawyer, work up the appropriate documents, and then tuck them away in a lock box somewhere and forget about them. In reality estate planning is better viewed as an ongoing process just like financial planning in general. When you are managing your finances on an ongoing basis you are aware of the fact that you may have to take action at times as a response to … [Read more...] about Action Could Be Beneficial In 2012
To be optimally prepared for the future you must inventory your assets to gain an understanding of the value of your total resources and how this value compares to the estate tax exclusion. If you are in taxable territory you are going to have to take steps in advance to gain tax efficiency in an effort to preserve your wealth. Right now the estate tax exclusion is $5.12 million per person. So, if you are married you and your spouse could combined your respective exemptions and have a total … [Read more...] about Can You Use Your Late Spouse’s Estate Tax Exclusion?
People around the globe are mourning the loss of the entertainment giant Dick Clark. The irrepressible impresario made his mark years ago as the host of the American Bandstand television show, and he presided over the evolution of popular music as we know it. Dick Clark passed away a wealthy man with a fortune estimated to be valued in the hundreds of millions of dollars. Since Clark is generally perceived in a very positive light you may find it possible to empathize with the situation that … [Read more...] about The Estate Tax and Dick Clark