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eAlert: Proposed Law Change May Impact Your Estate Planning Options

September 2016

Gift and Estate Tax Planning
The Internal Revenue Service just issued proposed regulations that, as early as January 2017, would eliminate valuation discounts for intra-family gifts of family-controlled assets.  If the regulations take effect, the increased gift and estate tax liability associated with these intra-family transfers could make it much more difficult for families to keep closely-held businesses, real estate (such as vacation and rental properties) and other such investment assets in the family for the long term. 
Under current law, individuals may transfer these investment assets to family at reduced values for gift and estate tax purposes, often without sacrificing control of the assets.  Please contact us as soon as possible if you wish to take advantage of tax-leveraged gifting in 2016.

Income Tax Planning and Deductions
This is also the time to consider year-end income tax planning.  Taking advantage of year-end gifting can also effectively transfer income to family members with lower tax brackets.  Contact us to discuss what year-end action may help reduce your 2016 income tax liability, including opportunities involving retirement plan accounts (whether you are on the contributing or the distributing side of the formula) and assets that are highly appreciated or are rapidly appreciating.  Also, professional fees associated with tax planning and business matters can be written off as miscellaneous itemized deductions on Schedule A of Form 1040.

Related Practice Areas

Estates and Trusts

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