In our previous post, we began looking at the new fiscal cliff deal Congress came up with in the 11th hour, and the way it will affect estate planning in the coming year. As we noted, The same exemption amount will apply permanently, with adjustments for inflation, meaning that wealthy estates have less to pay in estate taxes.
We've been talking about the estate and gift tax exemption debacle on this blog for a number of months now, informing our readers about the changes that could come in the New Year, and trying to stay on top of any developments. Now that Congress has come up with a fiscal cliff deal, we are able to relate to our readers how the changes will affect estate planning in the coming year.
In New Jersey law, there are not only federal estate tax, gift tax and income taxes to consider, but also state estate taxes and inheritance transfer taxes. Inheritance tax is not due for certain types of beneficiary-specifically, father, mother, grandparents, descendants, spouses, civil union partners, or domestic partners-though it is due for other types of beneficiaries in varying amounts. Those who owe inheritance tax are required to file a return with eight months of the decedent's date of death.
A recent Forbes article explored the various tactics used by wealthy men and women, particularly those with high-growth investments, to minimize tax liability. As our New Jersey readers know, avoiding estate and gift tax liability is an important aspect of estate planning, particularly since New Jersey is among the states that tax wealth transfers the most.
At present, several factors are combining to make for wonderful conditions for wealth preservation in estate planning. Those factors are favorable tax laws, a struggling economy, and low interest rates. Taking advantage of the current estate planning environment
Tax planning is one of the more tricky aspects of aspects of estate planning. Not only is there the need to navigate various tax systems, there is also the ever-changing law in this area.
In our previous two articles, we have been discussing important areas to be aware of when thinking about estate planning. So far, we have mentioned the potential importance of maintaining harmony in the family, avoiding probate, taking advantage of asset protection opportunities, tax planning, keeping attorney's fees manageable and making sure to select successor fiduciaries and contingent beneficiaries in your estate plan. Here we offer some final suggestions.
In our previous post, we began looking at an article discussing important matters all those engaged in estate planning need to consider.
Proactivity, as can be imagined-as opposed to acting out of necessity-is an essential aspect of effective estate planning. But it isn't always easy to decide which aspects of estate planning deserve the most or immediate attention.
In our last post, we began discussing some of the issues surrounding paying family members to provide caregiving services. Here, we want to continue that discussion by talking about potential tax implications and how these arrangements may affect Medicaid planning.