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News from Katz Baskies LLC
In This Issue
Highlights of the 2012 Tax Act
Act Now for IRA Charitable Rollover
Law Clarifies Beneficiary Designations in Divorces
Beware Corporate Law Scams
Katz Baskies a Best Law Firm
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January 2013

With the anticipation of significant changes to the tax law, a great deal of the focus of the last several months has been on the planning opportunities resulting from the higher gift and estate tax exemptions in effect prior to December 31. The government rang in the New Year with the American Taxpayer Relief Act of 2012, which included a continuation of some things and major overhaul to others. We are happy to discuss how the new law affects your income and estate tax planning.  

New Tax Act Features Continuation of Estate and Gift Exemption
Highlights of the American Taxpayer Relief Act of 2012  


living trust document image People will continue to debate whether we have or have not avoided some fiscal cliff with the recent passage of the American Taxpayer Relief Act, but at least there is some certainty as to tax rates beginning January 1, 2013. From a planning perspective, it is helpful that the rates are stated to be permanent (although "permanent" seems to be a relative term in Washington - we'll see what happens when Congress actually addresses the spending side of government). This is a good time to look ahead to 2013, and to look back a bit on what happened in 2012.   Read more here. 
Act Now for New Charitable Rollover Opportunity
Charitable Rollovers for 2012 can be made until February 1  


charitable giving

The American Taxpayer Relief Act restored the ability of individuals 70 and older to make IRA distributions directly to charity of up to $100,000. This avoids the need to take the distribution into income and then make a charitable contribution, the deduction for which may or may not be equal to the amount of the income (this is particularly so with the reinstatement of the phaseout on itemized deductions for high income taxpayers and the alternative minimum tax). Unfortunately, the law was enacted too late for anyone to plan for 2012 distributions. To address this situation, there are two time-sensitive elections that can be made. For anyone aged 70 and older that took a distribution in December 2012, up to $100,000 may be contributed to charity prior to February 1, 2013 and treated as a direct distribution by the IRA to the charity. In addition, any distributions made by the IRA to charity in January 2013 may be treated as if made in 2012. Thus, charitably-minded individuals can contribute a total of $200,000 in 2013 from an IRA ($100,000 being counted towards 2012). Please note that the law was only extended to 2013, but hopefully will be further extended for future years. 

Law Clarified as to Beneficiary Designations of Divorced Spouses   

Florida Statutes Now Terminate Rights of Divorced Spouses  


Effective July 1, 2012, a New Florida Statute Clarifies the Impact of Divorce on Assets with Beneficiary Designations.

Prior to July 1, 2012, Florida law provided that divorce terminated rights of an ex-spouse under a Will or Revocable Trust, but not as to assets with beneficiary designations.  However, a new statute that took effect July 1, 2012, clarifies the impact of divorce on non-probate and non-trust assets. For more on this new law, read here.


Beware the Corporate Scam  

Official Looking Letter is not from State  

The Florida Secretary of State is beginning to send out notices for annual renewals of entities. Florida corporations (like those in other states) are obligated to file an annual report with the Florida Department of State, including reporting the current officers and directors. An annual fee of $150.00 must be paid to the state (fees differ for partnerships and limited liability companies). An enterprising group going under the name "Compliance Services" has begun to send out requests for information to Florida corporations, and for a $125 fee states that it will prepare documents to satisfy the annual minutes requirement for the corporation. They are correct that there is an annual minutes requirement, and all corporations are certainly urged to maintain a corporate minute book. But don't confuse this organization for the Florida Department of State. If you have any questions about corporate maintenance, please do not hesitate to contact us.     
Katz Baskies named as a Best Law Firm

We are pleased to report that in the "Best Law Firms" ranking published by U.S. News and Best Lawyers, Katz Baskies has been selected as a "Tier 1" firm (the highest rating) in South Florida in the area of Trusts & Estates Law. Both Tom and Jeff have regularly been selected as Best Lawyers in the areas of Tax Law and Trusts & Estates Law, and we can now add the Firm to this prestigious listing. Moreover, Jeff was named the 2013 South Florida "Lawyer of the Year" in Estate Planning. It is also meaningful because we are one of the very few boutique firms in all of South Florida to be in the Tier 1 category in Trusts & Estates Law.


  Best Lawyers               Jeff Top Lawyer

Visit our Best Lawyers information here    


We know it will take some time for clients to fully digest the provisions of the recent Tax Act. It is worth emphasizing that for some clients the higher exclusion amounts mean that no estate or gift tax will be due on wealth transfers, while for other clients the higher estate tax rate highlights the need for continued strategic gifting. If you have any questions about these or other matters, please do not hesitate to contact us.

Thomas O. Katz and Jeffrey A. Baskies
Katz Baskies LLC
2255 Glades Road, Suite 240W
Boca Raton, Florida 33431