A Once in a Lifetime Opportunity
Our elected officials in Washington seem to give us temporary laws these days and the 2010 Tax Act is another example. Passed at the end of 2010 to prevent an automatic income tax and estate tax increase; it presents a once-in-a-lifetime opportunity to pass generational wealth.
Overview
The gift, estate and generation-skipping transfer (GST) exemption amounts in 2011/2012 are increased to $5 million ($10 million with portability). Portability is the right given to the surviving spouse to use the deceased spouse's unused estate tax exclusion.
The gift, estate and GST has been reduced to 35% in 2011/2012 as well.
In 2013, left untouched, the exclusion will drop back to $1M, portability goes away and the tax will jump back to 55%.
Every family's situation - we can't give "group advice" in a newsletter. The only way to know is to see your experts. That said, this is most important for estates greater than $1-2M in total value. It's less important for very large estates that require more complex planning. Don't waste time!
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What to Do Next
First, put this into perspective - make sure you apply a comprehensive approach to your financial planning. Estate planning is but on part of a comprehensive plan.
Second, don't delay. This is not a situation where you should wait until the 2nd half of 2012 to act. Act now.
We suggest that you (individual or couple) create a clear vision of your desired life and from there determine your tangible financial goals. Then work with a team that can help you build and begin executing that plan. An important portion of that planning is estate planning.
We team with independent experts - we call them subject matter experts. Our estate planning attorneys are the best in San Diego County and a delight to work with.
You do not have to become our client to get access to our team members. Just give us a call.
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