Gift Tax Savings Opportunities May Be Coming to an End on
December 31, 2012
At the end of 2010, Congress enacted the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 ("2010 Tax Law"). The 2010 Tax Law made substantial and significant changes to the Federal estate, gift and generation-skipping transfer (GST) tax system. These changes are set to expire on December 31, 2012 unless Congress acts soon.
There are now unprecedented gift planning opportunities available, but they must be acted upon before the expiration of the current Tax Law in order to reap the benefits.
IRS Issues Temporary and Proposed Regulations to Provide Guidance on Portability of Estate Tax Exclusion
Portability, a concept in which a surviving spouse is allowed to use a predeceased spouse's unused applicable exclusion amount, was established by the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 ("The Act"). Portability effectively doubles the amount that a married couple may pass on to their beneficiaries free of estate taxation. On June 15, 2012, the IRS issued temporary and proposed regulations to answer questions raised by the provisions included in the Act.
The Act provides for portability between spouses of the $5 million estate tax exemption amount, ($5,120,000, as indexed for inflation, in 2012) for estates of decedents dying in 2011 or 2012. This option is available only in the event that both spouses die after 2010, but before 2013. Under the portability provision of the Act, the unused portion of the last deceased spouse's estate tax exemption is available to the surviving spouse, who may utilize such unused portion for both gift tax and estate tax purposes. The portability provision, however, is not available for generation skipping transfer ("GST") tax or state death tax exemption purposes.
The Marcum Family Wealth Service Group is dedicated to helping you manage your wealth, assisting in transferring it to succeeding generations and helping you achieve your philanthropic goals. As the advocate, counselor and trusted advisor to hundreds of families throughout the United States, Marcum works closely with high-net-worth families to manage their fiscal affairs. Marcum guides individuals through the most complex tax issues to help them meet their financial goals by offering an array of tailored services including:
Marcum's Family Wealth Service Group works closely with clients to understand their specific needs and objectives. Each member of our highly skilled department - from partner to staff - undergoes rigorous, ongoing training to ensure our department is abreast of the latest developments in tax law and reporting requirements. As a growing firm - it is our goal to give our clients access to the best and most experienced professionals in all areas. We are determined to uphold our culture of customized services and personal attention. Marcum's knowledgeable and respected team is devoted to protecting the financial future of our clients.