Last month the Treasury Department proposed rules that could dramatically impact estate tax planning. Specifically, the Treasury Department is planning to limit, or even eliminate, the use of "valuation discounts" for closely-held companies, LLCs and other assets. The Treasury Department issued these proposals in August. On December 1, 2016, there will be a public hearing to discuss the merits of this proposal. It is possible the Treasury Department will formalize changes to these rules before the end of 2016.
Many New Jersey families are interested in ways to reduce their estate tax obligation. While there are a number of ways to reach that goal, some are more creative than others and can benefit multiple members of the same extended family. An example lies in a practice known as upstream gifting, which can have capital gains and estate tax planning benefits for three generations or more within the same family.
Many New Jersey families are looking for ways to reduce their estate tax burden. One option for married couples lies in using a bypass trust to hand down retirement savings. In order to make use of this tool, it is important to understand how these trusts work and how to maximize their effectiveness in reducing estate tax obligations.
When creating an estate plan, many New Jersey residents consider whether life insurance is a useful tool. Life insurance can provide wealth to the loved ones left behind, and can make it far easier for them to maintain their quality of living as they adjust to their loss. However, there is an important aspect of life insurance and estate tax planning that is often overlooked.
As a New Jersey resident ages, he or she will have different estate planning needs. Understanding those needs can help ensure that a proper estate planning approach is put to use, and that one's needs are being properly addressed. While there is no such thing as an "ideal" age to begin the estate planning process, the following guidelines are given in the hopes of underscoring the benefits of putting one's wishes into a legal format.
For many generations, families in New Jersey and across the nation have turned to their family business as a means of passing down wealth from one generation to the next. Through careful planning, families can use their businesses as a means of portability, giving children and grandchildren a way to tap into the family's assets without incurring high levels of taxation. This estate tax planning tactic, however, may soon be subject to change if the Internal Revenue Service places limitations on how those assets are valued.
Many New Jersey families have amassed a considerable amount of wealth. When considering estate planning options, many of these families are looking for ways to minimize their estate tax obligation while also allowing their wealth to have a positive impact, both for their heirs and for society in general. One option that meets both of those objectives is the creation of a family foundation funded by a charitable trust.
The estate tax, also commonly referred to as the "death tax," is a popular subject among many in New Jersey, even though very few Americans are at risk of being subjected to the tax. People tend to hold strong opinions on the matter, and it is a prime example of a topic that tends to reveal one's political leanings. The estate tax has once again become a topic of conversation due to a recent House vote supporting the repeal of the tax.
In decades past, individuals who were seeking estate planning guidance were told that there are three basic places where one can leave their assets upon death: family, charity or taxes. This approach defined the overall estate planning process for many years, but it does little to meet the needs of today's clients. Many New Jersey residents want to make their estate plan about more than the simple passing of assets to family members and reducing their estate tax burden.
Many New Jersey residents have worked hard to build a strong base of wealth. Retaining as much of that wealth as possible becomes a priority for many families. Understanding the proper steps required to do so can be a challenge, as there are a wide range of rules in place that must be carefully adhered to in order to achieve a favorable result. By working with an attorney, individuals and families can create an estate tax planning strategy that meets their needs.