1. Estate Tax Uncertainty Continues
The fate of the federal estate tax likely lies in the results of the next election. Here are the
most probable scenarios.
Place logo
or logotype
here,
otherwise
delete this.
VIDEO
LAW OFFICE OF DAVID PARKER BLOG
PLLC
2. The current estate tax, with a $5 million exemption and a 35%
tax rate on estates above that, is due to sunset at the end of this
year. Moreover, as everyone knows, it’s an election year. The
president, every Representative, and many Senators are up for
reelection. The outcome of the election will have major
implications for the future of NY estate planning, but of course
the new president (if there is one) and Congress won’t take
office until 2013. President Obama and this year’s Congress
will have to take whatever action is to be taken.
Place logo
or logotype
here,
otherwise
delete this.
VIDEO
LAW OFFICE OF DAVID PARKER BLOG
PLLC www.parkertrustlaw.com
3. Given the inability of the two parties to work together since the
Republicans took over the House, gridlock is a very real
possibility. If that happens, the estate tax may revert to its pre-
Bush levels of 55% on estates of over $1 million. Even those
politicians who want to see an increase in the estate tax don’t
really want to take it that far, although Congressman Jim
McDermott of Washington has introduced a bill that would
raise the estate tax to that level, adjusted for the aggregate
inflation over the past decade or so.
Place logo
or logotype
here,
otherwise
delete this.
VIDEO
LAW OFFICE OF DAVID PARKER BLOG
PLLC www.parkertrustlaw.com
4. It’s also possible that Congress will choose to punt – to kick the
can down the road, so to speak. Obama might well sign a bill
extending the current rates and exemptions for another year or
two. Any such action would have to take place before the
election, most likely. This would simply preserve the current
situation until the new Congress and (possibly) new president
are in office to make more long-term arrangements.
Place logo
or logotype
here,
otherwise
delete this.
VIDEO
LAW OFFICE OF DAVID PARKER BLOG
PLLC www.parkertrustlaw.com
5. What all of this amounts to is the fact that the estate tax, with its
immense implications for New York asset protection, is still up
in the air. The same is true of gift taxes as well. Regardless of
what happens in politics and law, it’s still important to make
early and flexible estate plans. Having plans in place based on
current law will not hurt even if the current law changes, but as
always, the best course is to be aware of what’s going on and
make plans early.
Place logo
or logotype
here,
otherwise
delete this.
VIDEO
LAW OFFICE OF DAVID PARKER BLOG
PLLC www.parkertrustlaw.com
6. Law Office of David Parker
Estate Planning and Elder Law
www.parkertrustlaw.com
