I saw the following in Stephen Leimberg’s Estate Planning Newsletter. This week’s issue written by Marty Shenkman and Bob Keebler who are well known national experts on tax law. I will quote Mr. Shenkman and Mr. Keebler’s words and then provide a couple of points below that as my added commentary:
“Likely Changes to the Current Estate and Gift Tax Laws:
The collective effect of several, or perhaps all of these types of changes, could change the face of estate planning in a profound manner. The effective date could wreak havoc with 2012 planning that may still be in process if changes are enacted before year end. We may wake-up on January 1, 2013 to find an empty estate planners toolbox.”
A lot of the above is self-explanatory I think. The tax exemption will likely be lower, tax rates likely higher and planning is important. However, focus on a couple of the above shows that the government is cutting into the planning options for the wealthy but they will likely be grandfathered in. This tells me you need to plan NOW. The loss, or restrictions, on valuation discounts could be huge for families utilizing planning vehicles like the Family Limited Partnership (or family LLC). Likewise the restriction on avoidance of the generation skipping tax could be huge down the road. It’s not likely to have a large impact during our lifetime but future generations will notice a difference Thus, the wealthiest of us need to be taking action NOW! Not next week or next month but TODAY! Call you estate planning attorney right now and get your planning started!