|
Philadelphia PA Estate Planning Blog
Monday, December 7, 2009
Thinking about making that charitable gift sometime soon? Now is the time to do it, before December 31. This is one of several tax-saving strategies that you can apply during the month of December, so that come April 15, you can rest a bit easier at night. Check out the article from Forbes magazine, detailing the federal tax saving strategies
here
.
Sunday, December 6, 2009
Heading to Atlanta, GA today for the WealthCounsel estate planning education sessions. I try my best to never miss an opportunity to learn more about estate planning techniques. This week, going to be learning some new techniques for living trusts.
Saturday, December 5, 2009
Did you know that approximately 70% of adults in the United States have no estate plan? No will, living trust, powers of attorney or living wills? If you are one of the 70% without a plan, talk to us today. It's never too late or too early to start estate planning. It's the greatest gift you can leave to your loved ones.
Saturday, December 5, 2009
Just posted a new article to help those new to estate planning. Catch
Ten Steps To Estate Planning
under our Resources tab. If we can help you with your estate plan, please let us know by getting in touch with our office.
Thursday, December 3, 2009
Did you know we are on Facebook? Become a fan of our page at www.Facebook.com/JawAtLaw.
Thursday, December 3, 2009
Breaking estate tax news from the Associated Press... Stayed tuned for further developments right here on our blog.
---
House Votes to Extend Tax on Wealthy Estates at Reduced Rate
AP
WASHINGTON -- The House voted Thursday to permanently extend a 45 percent inheritance tax on estates larger than $3.5 million, canceling a one-year repeal of the tax set to begin next month.
A similar effort is afoot in the Senate, but the health care debate there could preclude action on the estate tax before Congress breaks later this month for holidays. There are also disagreements among senators over the tax rate and the size of estates that should be exempt, further clouding the bill's prospects.
Lawmakers, however, don't want to delay action until next year because they are wary of enacting retroactive tax changes. Under the House bill, estates smaller than $3.5 million would continue to be exempt from the tax. Married couples, with a little estate planning, could exempt a total of $7 million. That leaves less than 1 percent of all estates subject to the tax.
The bill passed by a 225-200 vote, with all Republicans opposed. Majority Democrats argued that a permanent tax rate makes it easier for families and small business owners to do estate planning, noting that fewer than 1 percent of all estates are subject to the tax. "In America, it's not a sin to be rich nor is it a crime to die rich," said Rep. Jared Polis, D-Colo. "This bill gives our nation's wealthiest families the ability to know exactly what their obligation to the nation that fostered their wealth will be, and it is fair and it is just."
The bill follows the federal budget proposed by President Obama. But many Republicans called for permanent repeal of the estate tax, arguing it hurts families that pass down farms and small businesses to their children. "The majority claims to be offering certainty to taxpayers and I suppose in a way they are -- they are certainly repealing the hope of ever eliminating the death tax," said Rep. Dave Camp of Michigan, the top Republican on the tax-writing House Ways and Means Committee. Under current law, the federal estate tax is scheduled to temporarily disappear next year before returning in 2011 at an even higher 55 percent rate.
During the year without an estate tax, all estates would be subject to a 15 percent capital gains tax that they now avoid. "If Congress does not act on this issue this month, you would have a wildly fluctuating scenario of different estate tax levels, making it impossible for families to plan," said Rep. Earl Pomeroy, D-N.D., chief sponsor of the House bill. Some liberals have complained that the bill is a giveaway to the rich because it would result in lower rates in future years than what current law provides.
Conservatives have labeled the estate tax a "death tax" and argue it should be repealed permanently. "We're trying to forge a compromise that resolves this issue once and for all," Pomeroy said. Rep. Louie Gohmert, R-Texas, likened the estate tax to stealing from the dead. "After someone dies and someone comes in and steals from them, we consider that in most society reprehensible," said Gohmert, a former judge. "I have sentenced people personally to prison for doing that."
The quirk in the law, in which the estate tax would disappear for only a year, came out of a series of tax cuts enacted in 2001. Many Republicans, who controlled Congress at the time, wanted to permanently repeal the estate tax then. But they settled on a gradual reduction, with a one-year repeal, to reduce the impact on the federal budget deficit.
Under current law, the estate tax would return in 2011 with a $1 million exemption and top rate of 55 percent, unless Congress acts. Permanently extending the tax with a top rate of 45 percent on estates larger than $3.5 million would raise about $14 billion a year. However, it would raise less tax revenue than current law over the next 10 years -- an estimated $234 billion less -- because the tax rate would be lower in future years. The lost revenue would be covered with increased borrowing. Under current law, if someone inherits a $5 million estate in 2009, they would pay $675,000 in federal estate taxes, according to an analysis by Deloitte Tax. In 2010, they would pay no estate tax but the estate would be subject to a 15 percent capital gains tax. If they inherit the $5 million estate in 2011, they would pay $2,045,000 in estate taxes, according to the analysis.
Under the House bill, they would pay $675,000 in estate taxes, regardless of which year the estate is inherited. Currently, the tax affects few estates. In 2009, about 5,500 estates will be subject to the tax, according to projections from the Tax Policy Center, a Washington think tank. That's 0.23 percent of all estates.
Wednesday, December 2, 2009
Determining if a trust is appropriate for you depends on your objectives and your needs. Suppose, for instance, you have adult children in whose ability to handle the financial responsibility of inheriting your estate you have complete confidence. You’re unsure whether the idea of keeping assets in trust for them after your death is appropriate.
It would still make sense to use a trust during your life, as doing so will allow for the seamless transition of control of the assets at your death. And assets held in your trust prior to your death will pass to the beneficiaries without being subject to probate, which can be expensive and always is a public process.
In deciding whether to keep assets in trust after your death, though, you need to weigh the disadvantage of burdens — and, more important, the idea of having the assets “tied up” rather than going outright to your children — against the potential estate tax benefits down the road.
Your circumstances will help to determine whether the assets should remain in trust. For instance, depending on the size of your estate, the trust can provide a means of keeping assets outside of the estate tax system forever or, at a minimum, for at least a generation.
Tuesday, December 1, 2009
Welcome to our blog, where you will find essential and timely information on estate planning.
Within estate planning, our blog will cover a variety of topics. We welcome you to subscribe to our blog by email or check back at our web site regularly for updates.
When you visit our blog, you'll find information on estate planning, living wills, advanced health care direcives, powers of attorney, revocable living trusts, wills, the federal estate tax, the Pennsylvania Inheritance Tax, same-sex and LGBT planning, non-traditional planning, special needs trusts, pet trusts and more.
We look forward to seeing you often!
Tuesday, December 1, 2009
There is possible movement in Congress this week on crafting an estate tax "fix" (some people may have other names for it) in 2010 to keep the highly regarded tax at the current 2009 levels. Previously, the federal estate tax was to be repealed in 2010, and then was to come back in 2011. If that wasn't bad enough, now it looks as though Congress may actually find a way to keep the tax in 2010 at the last minute. We will keep you updated on the latest developments. Right now, the federal estate tax is 45% if your assets are worth more than $3.5 Million, and $7 Millon for a married couple. Below those numbers, you are exempt from the federal estate tax.
The Law Offices of Jeremy A. Wechsler assist clients with Estate Planning matters in Willow Grove, PA as well as Abington, Hatboro, Dresher, Horsham, Bryn Athyn, Huntingdon Valley, Fort Washington, Jenkintown, Glenside, Oreland, Warminister, Wyncote, Ambler, Elkins Park, Flourtown, Philadelphia, Warrington, Cheltenham, Gwynedd Valley, Jamison, Feasterville Trevose, Richboro, North Wales, Blue Bell, Lafayette Hill, King of Prussia, Collegeville, Oaks, Phoenixville, Oxford Valley, Langhorne, Penndel, Bristol, Fairless Hills, Bensalem, Plymouth Meeting, Furlong, Philadelphia County, Bucks County and Montgomery County.
|
|
|
|