With the re-election of Barack Obama to a second term, we know that we are likely to see higher taxes and further redistribution of wealth. There is less than 8 weeks left to take advantage of the current tax law to implement estate planning techniques to minimize future estate and gift taxes. With the Republicans retaining the House of Representatives, Democrats retaining control over the Senate and President Obama retaining the Presidency, it appears a stalemate may be in the works. Regardless, given the budget concerns facing the nation with the pending fiscal cliff, it is clear that absent new legislation, the $5 million unified exemption for gift and estate taxes will disappear.
December 31, 2012, is your last chance before the combined gift and estate tax exemption amount reverts back to $1 million and a top rate of 55%.
This is in stark contrast to the current combined estate and gift tax exemption amount of $5.12 million with a top rate of 35%. Assuming President Obama and Congress cannot work together to extend these tax benefits, you must move quickly in order to take advantage of the opportunity to gift and implement estate planning strategies prior to year end. In order to take advantage of these estate planning opportunities, we recommend you contact us immediately. If you would like assistance in implementing an estate planning or gifting tax saving strategy, please call Jeffrey Skatoff at (561) 842-4868.