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Posts tagged estate tax.
By Keith Herman on November 26, 2018 at 1:20 PM

Piggy bank sitting on top of a pile of tax return papersWith an estate tax exemption of $11.18 million in 2018 (rising to $11.4 million in 2019), estate planning has been turned on its head. For most people, estate taxes are no longer an issue, and the increased exemption provides options for reducing capital gains taxes. For those families with estates over $22.8 million, the new gift/estate tax exemption provides additional opportunities for estate tax planning.

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By Elizabeth Pack on October 16, 2018 at 1:50 PM

Businessman showing percentage symbolsThomson Reuters recently published its estimated figures for 2019 for estate and trust income tax brackets, as well as the exemption amounts for estate, gift and generation-skipping transfer (GST) taxes. These figures are adjusted annually for cost-of-living increases.

Pursuant to the Tax Cuts and Jobs Act, the measure of inflation has changed for these figures. Thomson Reuters warns that because of errors and ambiguities in the act, the estimates were made based upon what Thomson Reuters staff believed to be consistent with congressional intent.

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By Keith Grissom on August 29, 2018 at 10:20 AM

Jar of money with another jar labeled "tax"Traditionally, due to lower estate tax exemption amounts, many married couples would use bypass trusts or credit shelter trusts as part of a typical estate plan. For example, on the death of the first spouse, assets in that spouse’s revocable trust would be allocated to a bypass trust (frequently referred to in the trust document as a family trust) up to the amount of the deceased spouse’s remaining estate tax exemption, with the balance allocated to a marital trust for the surviving spouse. The bypass trust would not only pass estate tax free at the first spouse’s death, but would also be outside of (i.e., bypass) the surviving spouse’s taxable estate at death. In addition, the bypass trust assets might continue from generation to generation without being subject to any additional “transfer taxes” like the generation-skipping transfer (GST) tax, if GST exemption was allocated to the trust. This type of planning continues to provide a variety of benefits.

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By Keith Herman on April 27, 2018 at 1:35 PM

$100 bills sticking out of a white and red gift boxOn December 22, 2017, President Trump signed into law what is commonly known as the Tax Cuts and Jobs Act of 2017 (2017 Act). The 2017 Act increased the estate, gift, and generation-skipping (GST) transfer tax exemptions to $10 million, indexed for inflation ($11.18 million for 2018), and retained the estate/gift/GST tax rates of 40 percent. The gift tax exemption is now significantly larger than it has ever been, and larger than it was ever expected to be. Below are 10 things to consider in determining whether to make a gift to take advantage of the existing $11.18 million gift tax exemption. In addition to the tax benefits, making a gift during your lifetime allows your children or other beneficiaries to benefit from the gift, and you will also benefit by seeing them enjoy it.

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By Serafina Nicolais on February 16, 2018 at 11:52 AM

Dancer showing Michael Jackson's "toe stand" dance moveWhen Michael Jackson died in 2009, he left behind a convoluted legacy that has presented issues for fans and tax collectors alike, and the legal repercussions are ongoing.

At the time of his death, Jackson’s reputation had suffered from allegations of child abuse, drug use and erratic behavior. The circumstances of his death, however, heightened fans’ sympathy for the tragic “King of Pop.” Because of this, Jackson’s estate is embroiled in a legal dispute with the IRS over the value of Jackson’s name and likeness.

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By Andrew Wolkiewicz, Keith Herman on January 31, 2018 at 10:54 AM

Paper house and calculator on top of a book, showing estate planningOn Dec. 22, 2017, President Trump signed into law what is commonly known as the Tax Reform and Jobs Act of 2017 (2017 Act). As explained in more detail below, the 2017 Act increased the estate, gift, and generation-skipping transfer (GST) tax exemptions. This legislation expires at the end of 2025 and the tax laws will revert to where they stood prior to the 2017 Act unless Congress makes additional changes before then.

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By Keith Grissom on November 3, 2017 at 12:47 PM

U.S. Capitol BuildingOn Nov. 2, 2017, House Republicans released their long-awaited tax reform bill called “The Tax Cuts and Jobs Act.” The bill contains sweeping changes in a variety of areas and expands upon, and in some cases changes, what was included in the “Unified Framework for Fixing Our Broken Tax Code,” released in September 2017 (discussed here).

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By Keith Grissom on September 29, 2017 at 2:32 PM

Metal wheel with the words "tax reform" on itThe Trump Administration, along with the Senate Committee on Finance and the House Committee on Ways and Means, on Sept. 27, 2017, released the “Unified Framework for Fixing Our Broken Tax Code.” The framework is a consolidation of earlier proposals including the 2018 budget plan and the one-page memo previously released, as well as the Tax Reform Tax Force Blueprint released by House Republicans in 2016.

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By Andrew Wolkiewicz on September 18, 2017 at 10:10 AM

Money laying next to a gift box. Bloomberg BNA has released its U.S. tax rate projections for 2018, which can be found here.

There are two very important changes expected that will impact estate planning in the coming year. BNA is projecting that the annual gift tax exclusion will rise from $14,000 to $15,000. This means individuals and married couples will be able to transfer more wealth, tax free, each year. This change is particularly important for trusts funded annually with an amount equal to the gift tax exclusion. 

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By Keith Grissom on June 1, 2017 at 3:54 PM

Question mark surrounded by dollar symbolsOn May 23, 2017, the Trump administration released its fiscal year 2018 budget, titled “A New Foundation for American Greatness.” In it, the administration provides another glimpse at its intentions regarding the future of the estate tax.

In the section titled “How to Make Things Right: New Policies for Jobs and Growth and New Spending Priorities,” it provides, in part, that,

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