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Now is the time to do asset protection and estate planning. The exemptions will sunset on 01/01/2026. The exemption is currently about $13M, but will fall to an inflation adjusted $5M on 01/01/2026 if the exemptions are allowed to fall. If we have divided government, then it is likely that the exemptions will sunset. We …
SUMMARY: THE INFLATION REDUCTION ACT OF 2022The Inflation Reduction Act of 2022 will make a historic down payment on deficit reduction tofight inflation, invest in domestic energy production and manufacturing, and reduce carbonemissions by roughly 40 percent by 2030. The bill will also finally allow Medicare to negotiatefor prescription drug prices and extend the expanded …
1202 is a little know or understood provision of the Internal Revenue Code that excludes the greater of (1) $10M or (2) ten times basis in original issue stock. To qualify for 1202, the company must be a C corporation and have aggregate assets of $50M or less at stock issuance. The investor must acquire …
The Little Known 1202 Small Business Stock Exclusion Read More »
While each situation is different, I think in most cases, the decedent should keep his family informed of his or her estate plan. If the decedent wants to treat his children or others differently, the decedent should communicate with that family member why. It may be because a family member has special needs or it …
With the very real possibility that capital gains will be taxed at ordinary income rates for those making $1,ooo,ooo or more, it is time to consider the charitable remainder trust again. A charitable remainder trust (CRT) is a split-interest trust, with the grantor receiving an income interest and charity receiving the remainder. If you have …
Time for the Charitable Remainder Trust to Make a Comeback Read More »
As I write this, Senate Democrats have made a reconciliation proposal. Word is that not all Senate Democrats are on board yet, but this is their one shot and I expect something will get done. My contacts in DC think that reduction in the exemption will be part of the bill, but don’t know if …
The recently enacted Secure Act, eliminates the life time stretch of retirement assets for non-spouse beneficiaries, with a few exceptions. Instead, these assets will now be taxed within ten years. For the charitably minded client, one idea being touted is a charitable remainder unitrust (CRT). Based on materials I have seen, the ideal payout rate …
Congratulations to the Nationals! With interest rates at near record lows, it is a great time to consider a grantor retained annuity trust (GRAT). GRATs are a planning technique in the Internal Revenue Code to remove future appreciation in the asset gifted to the GRAT out of the grantor’s estate. The grantor contributes an asset …
The Tax Court in Estate of Aaron U. Jones upheld the use of tax-affecting in the valuation of gifts made of S corporation and limited partnership interests. The business involved timber, and the income method is typically used to value an ongoing timber business. Tax-affecting is adjusting the value to reflect an after tax value …
Some well known planners, such as Stacy Eastland, are recommending consideration of the BDOT for families with significant wealth to plan with the existing $11.2 million exemption. Most of you are aware of the Beneficiary Defective Inheritor’s Trust (BDIT), which is funded with only $5,000, and provides that all of that $5,000 may be withdrawn …