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Thank Congress if You Made Big Gifts in 2012

Hank Wittenberg has a great article on estateplanning.com on why those of you who did year end planning in 2012 made the right choice, even though Congress extended the generous gift and estate tax exclusions with the American Taxpayer Relief Act. The tax act signed into law by President Obama last week provided some very good estate planning provisions. Surprisingly, I have already read and heard complaints from other estate planning attorneys…

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New 2013 Gift Tax and Estate Tax Rates – Now What?

Congress surprised us again and passed the American Taxpayer Relief Act (don't you love the catchy name) on January 1 to temporarily avoid the fiscal cliff. Overall, the new law is much better than the experts expected. It extends the estate tax and gift tax exclusions of 2012 and even indexes them for inflation. In 2013, you can gift $5,250,000 with no gift tax. In 2013, you can die with $5,250,000 with…

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How the Lifetime Bypass Trust Works: Attention CPAs

Many of my clients are interested in the Lifetime Bypass Trust. And some are vetting the concept through their CPAs. Here is an email (with the names removed) I have sent to several CPAs to clarify this amazing but simple planning strategy. The structure we are proposing is a lifetime bypass trust. The concept is the same as used with an A/B trust, or bypass trust. When a bypass trust is created…

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Lifetime Bypass Trust

Until December 31, the lifetime gift tax exclusion is $5,120,000 per person. Unless Congress acts, this amount will drop to $1,000,000 on January 1, 2013.  It is usually best to use a tax exemption as soon as possible – use it or lose it. The opportunity, good now through the December 31, is to gift assets out of your estate and forever exempt the assets and all future appreciation from estate tax.…

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Act by Dec. 31 to Avoid Estate Tax (click for slide show)

We now know the next President and the composition of Congress. Most likely, the historic estate and gift tax exclusions that end on December 31, 2012, will never be seen again. This may be the best opportunity in your lifetime to remove assets from your estate and forever avoid estate tax. Watch the slide show below to learn more about what you can do in the remaining days of this year to…

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Annual Gift Tax Exclusion Up to $14k in 2013

The IRS will increase the annual gift tax exclusion from $13k to $14K in 2013. The annual gift tax exclusion is the amount you and your spouse can each gift to anyone without dipping into your lifetime gift tax exclusion (the lifetime gift tax exclusion is currently $5,120,000 and scheduled to drop to $1M in 2013).  From Forbes: There is one change taking effect in January 2013 that’s new: the annual gift…

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Gift Now and Avoid Estate Tax

If you have a net worth of $1M or more (or as a couple, $2M or more), and act now, you could forever remove the threat of estate tax. But if you don’t act by the end of the year, you will miss a historic opportunity. The 2012 estate tax exclusion and gift tax exclusion are both $5,120,000 - way higher than they have ever been. But unless Congress and the President…

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Gift Now Before It’s Too Late

One of my clients send me a terrific article from Concannon Miller about the urgency to make gifts and how to make gifts before December 31. It is so good, I'm posting the whole article. When it comes to making a decision about gifts and protecting assets, the main message is that, if appropriate for you, make gifts before the law changes in 2013; however there are many important nuances to the…

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Make Gifts Before It’s Too Late

The consensus at the 2012 Southern California Tax and Estate Planning Forum is that recapture or clawback will not occur for gifts made in 2012. And even if it does, the opportunity cost of not making a gift this year will significantly outweigh any potential harm. From Prof. Samuel Donaldson: The short answer is that individuals in a position to make large wealth transfers should most definitely strike now, as the proverbial irons…

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10. Estate and Gift Tax – Part 1

This is part 10 in my series, Estate Planning – What You Need to Know. Part 10. Estate and Gift Tax - Part 1 The estate tax, aka the death tax, and the gift tax are separate but related. Let’s start with the estate tax. Estate Tax The estate tax is the tax the federal and state government levies on your estate when you die. The tax is based on the value…

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