SUCCESSIONS

AFRs for August 2012 (unbelievably low!)

It appears that the Section 7520 rate has never been this low. Coinciding with what may be the waning of the $5,120,000 lifetime gift tax exclusion, this presents a tremendous transfer tax planning opporutunities for the second half of 2012.

Ohio’s New Durable Power of Attorney Law

On December 21, 2011, Governor Kasich signed Senate Bill 117 into law. The bill became effective March 21, 2012. In addition to changes in state trust and probate laws, the bill adopts the Uniform Power of Attorney Act (UPOAA) with a few additions that are specific to Ohio. As a result, financial advisors can add value to their clients by making sure their client’s POA’s are updated to reflect the changes in the law.

A Big Price Tag for Waiting – Using the Estate/Gift/GST Tax Exemption in 2012

Current tax law provides for Estate/Gift/GST Tax exemptions of $5 million per person ($10 million for married couple) through 2012. This means that individuals can transfer significant amounts of wealth free of estate, gift and GST tax. However, these exemptions are scheduled to be significantly reduced to $1 million ($2 million) beginning on Jan 1, 2013, leaving only a limited time to optimize any gifting strategies to capitalize on the high exemptions. However, many people aren’t comfortable giving away such large amounts, concerned that they may need it for themselves in the future. This post outlines some irrevocable trusts strategies to help deal with that concern.