?Life insurance and annuities are supposed to accomplish straightforward goals:? life insurance provides for your family if you die unexpectedly and annuities guarantee a steady stream of income in retirement.? But right now, both are being promoted for their tax benefits.?
Even taxpayers who are exempt from the federal tax on estates under the American Taxpayer Relief Act would be wise to study how the law affects their estate planning.
You thought your estate plans were finally set? Not so fast.? It turns out the “permanent” $5 million estate-tax exemption enacted earlier this year could change after all, sending families back to the drawing board to sort out their strategy.
?Taxpayers who gave substantial assets to family members last year could be in for a nasty surprise this tax season: potential errors on federal gift-tax returns that could result in donors owing taxes on gifts they thought were tax-free.?
Despite the benefits and prestige that come with working at a top U.S. law firm, small and mid-sized firms, as well as boutique offices, offer trusts and estates lawyers a much more attractive proposition.
“The venerable law firm’s move to get out of the estate-planning business comes as the legal industry continues to emphasize more profitable practices.”
“For many of the wealthy, the American Taxpayer Relief Act, passed this week by Congress, is aptly named.? For estate and gift taxes in particular, all but the richest of the rich will probably be able to protect their holdings from taxes, now that Congress has permanently set the estate and gift tax exemptions at $5 million (a level that will rise with inflation).”
In light of current events, it?s fun looking back at the state of the industry when the Bush tax cuts were introduced.? The more things change, the more they stay the same.? From the article,??here are our fearless predictions on the impact that change ? whatever it is ? will have on the use of life insurance in the estate planning process and on planning in general.?? Near the end of the article we suggest a list of questions that clients and advisors might want to ask.
?There is a simple, little-known technique that can enable you to use your life insurance losses to save thousands of dollars in taxes.?
A private session presentation for the newest AEP?s and current ?AEP?s in Orlando in November at the 49th Annual Conference. ?You will not want to miss fellow designee Al Gibbons’ excellent presentation for active designees ONLY on Thursday 11/8/12 at 5:00 PM, “How AEP? Designees Can Work Effectively as Collaborative Teams and Why They Are Essential for High Net Worth Clients”. ?To read more about the conference and Al’s presentation, click here.