In addition to those detailed in our article, Commercial Lending...After The Crisis: Back To Basics, here are two more hard lessons learned from the financial crisis:

1. Paper equity and borrowed liquidity have a bad habit of disappearing when you need them most.

2. Contingent liabilities tend to become real liabilities at the worst possible time.

 

In today's continued uncertain credit environment, the fragility of equity and potential exposure to loss posed by contingent liabilities are two areas community banks should pay especially close attention to.  Read more...

A move is underway in Congress to stave off the sunset of the estate tax in 2010 and prevent a wholesale revision of the transfer tax rules in 2011. On October 22, a bipartisan group of House Ways and Means Members (Shelly Berkley (D-NV), Kevin Brady (R-NV), Devin Nunes (R-CA), and Artur Davis (D-AL)), introduced H.R. 3905, the "Estate Tax Relief Act of 2009. " This measure would repeal both the 2010 one-year termination of the estate tax and the new basis rules, increase the estate and gift tax unified credit beginning in 2010, and coordinate a reduction in the maximum rate of tax (from 45% to 35% over a period of years) with a phaseout of the deduction for State death taxes.  Read more...

As 2009 comes to a close, it's a good time to review your year-end tax planning strategies. Many traditional strategies are still effective for this year but you need to keep in mind the impact of pending federal legislation. Congress is debating health care reform, a possible second stimulus bill, extending many temporary tax breaks, and more.  Read more...